The front-month Brent/Dubai Exchange of Futures for Swaps was almost steady mid-morning trade in Asia Sept. 29, while market participants were cautious on Japan’s demand as a COVID-19 induced state of emergency is due to be lifted at the end of the month.
The November Brent/Dubai EFS was pegged at $4.01/b at 11 am Singapore time (0300 GMT), down 3 cents/b from the Asian close Sept. 28, S&P Global Platts data showed.
Japan decided to lift all of its state of emergency on 19 prefectures and its priority measures on eight prefectures on Sept. 30 following a significant drop in new infections. This will be the first time that Japan will not be under any of COVID-19 state of emergency and priority measures since early April.
However, the move is unlikely to see a spurt in oil and product consumption in the immediate few weeks, sources said.
“Think demand would bounce back in October., but there are no public holidays in that month. So demand recovery might be moderate not huge,” a trader with a North Asian refinery said.
Meanwhile, intermonth spreads narrowed mid-morning compared to close on Sept. 28.
The October/November timespread was pegged at a backwardation of $1/b, down 6 cents/b from the Asian close on Sept. 28, Platts data showed.
The November/December timespread was pegged at 84 cents/b, down 5 cents/b from the previous day.