04OCT2019 - NEWS - Weaker outright oil prices may offset strong Australian crude spot premiums

Cash differentials for various Australian sweet crude grades traded in the Asian spot market rallied to multi-year highs in recent trading cycles, but Canberra remains on its toes as the bearish outright oil price outlook could eat into the healthy physical market premiums over the coming years.

Multiple Australian heavy sweet crude grades saw their spot market price differentials surged to record highs in recent months, reflecting the boost in stockpiling demand for low sulfur fuel oil components in preparation for January 2020, when the International Maritime Organization’s new sulfur cap for bunker fuel kicks in.