LONDON: Forties crude differentials rose on Monday, tracking a surge in Brent crude futures to 2-1/2-year highs and as Shell and Glencore prepared to load at least 10 million barrels of crude to send to Asia this month.
A record nine supertankers loaded North Sea crude in October to make the 10,000-km trip east, carrying around 18 million barrels of oil, according to Reuters data and shipping sources.
Shell has been one of the major buyers of Forties crude in the last month, having built up a position of around 10 cargoes, trade sources said.
Shell has bought six November-loading cargoes of North Sea crude and owns at least a further four loading between very late October and early November.
Shell alone has booked three VLCCs to Asia this month. Glencore meanwhile looks set to send a second supertanker to Asia in November, after having booked the Texas to load at Hound Point in two weeks.
Glencore's shipping arm is also thought to have booked the Houston, a VLCC that was used for floating storage for several weeks before the dated Brent forward structure flipped into backwardation. The Houston is at Hound Point, but has not yet loaded, according to Genscape data.
Adding another boost to the physical market was a 3-percent surge in Brent crud futures to their highest since early July 2015, as Saudi Arabia's crown prince cemented his power over the weekend with an anti-corruption crackdown, while the US rig count fell and markets continued to tighten.
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