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WTI Midland Crude Differentials Ease in European Trading
The price differential for U.S. West Texas Intermediate (WTI) Midland crude weakened in Tuesday's trading session, reflecting a moderation in the premium for physical cargoes delivered into Europe. A key transaction between major energy traders highlighted the softer tone in the market.
Key Trading Activity
Energy trading firm Glencore sold a WTI Midland cargo to Norway's Equinor for delivery between August 30 and September 3. The deal was concluded at a price of dated Brent plus $5.50 per barrel on a cost, insurance, and freight (CIF) basis to Rotterdam.
This price marks a notable decrease from the previous day's trading. On Monday, Equinor had purchased a similar WTI Midland cargo from Glencore for August 23-27 delivery at a higher differential of dated Brent plus $5.95 CIF Rotterdam. According to market calculations, Tuesday's transaction is equivalent to approximately dated Brent plus $3.77 on a free on board (FOB) basis.
AdMarket Context
Further market activity for WTI Midland included a bid from TotalEnergies for an August 16-20 cargo at dated Brent plus $5.80 CIF Rotterdam. In contrast, Glencore placed an offer for an August 25-29 cargo at a lower level of dated Brent plus $5.25 CIF Rotterdam, indicating a wide bid-ask spread.
In the related North Sea market, Phillips 66 withdrew a bid for a cargo of Ekofisk crude. The bid had been for an August 26-28 delivery at dated Brent plus $6.00, according to market sources.
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