Oil & Gas

29 May 2024

UK's Buzzard Oilfield Has Temporary Outage, CNOOC Says

29 May 2024  by reuters   
The Buzzard oilfield in the North Sea is experiencing a temporary production outage, a spokesperson for operator CNOOC said on Tuesday, adding that there was no information on when the outage started and how long it would last.

Buzzard, one of the largest producing UK fields, is linked to the Forties crude stream, one of the North Sea crude grades that underpins the Brent benchmark, meaning that unexpected outages can affect global oil prices.

Brent crude was trading higher on Tuesday, rising to $84 a barrel.

"The Buzzard outages might have been a factor supporting oil today," said analyst Giovanni Staunovo of UBS, along with positive risk sentiment, geopolitical tension in the Middle East, and strong travel activity in the U.S. in recent days.

The Forties crude stream is scheduled to load seven cargoes of 700,000 barrels each in June. Two of these will be delayed as a result of the outage, two trade sources said, tightening supply in the physical market.

One June-loading Forties cargo belonging to Equinor (EQNR.OL), opens new tab and another owned by Shell (SHEL.L), opens new tab are delayed, trade sources said. Shell declined to comment while Equinor did not respond immediately to a request for comment.

The outage is not linked to a planned 14-day period of maintenance at Buzzard in August, CNOOC said.

Buzzard produces about 60,000 barrels of oil equivalent per day, field partner Equinor said in a June 2023 statement when its purchase of a stake in Buzzard plus other UK assets from Suncor Energy closed.

That is a tiny part of world supply although the field's connection to the Forties stream and Brent benchmark means outages can have a bigger impact on pricing than its size would otherwise justify, analysts and traders have said.


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