(Bloomberg) --

A closely-watched gauge of Asian oil demand is at its tightest level in more than two years, underscoring the region’s buoyancy just as investors expect a slowdown in Europe and the US following the recent turmoil in their banking systems.

The difference between London’s Brent and Dubai crude has fallen to $1.54 a barrel, the lowest since February 2021 and down from $9.30 as recently as November.

The development — given more impetus in recent days by refinery strikes in France, which have dented crude demand in Europe — is a further signal of Asia’s strength relative to other regions when it comes to energy consumption.

Thanks largely to China’s economic rebound following the ending of coronavirus lockdowns, Asia will account for 76% — or 1.3 million barrels a day — of global oil-demand growth this year, according to JPMorgan Chase & Co. Europe and the US will see a rise of just 30,000 barrels a day, the bank’s analysts, including Natasha Kaneva, said in a note last week.

Dubai crude spot prices act as a proxy for the heavy-sour barrels produced in large quantities in the Persian Gulf. The oil generally sells for less than Brent, which is lighter, sweeter and easier to refine into fuels like gasoline.

Gulf nations such as Saudi Arabia, Iraq and the United Arab Emirates sell the bulk of their oil to Asia, with China, India, Japan and South Korea being the biggest buyers.

Still, the Dubai benchmark’s rise may have run its course now the discount to Brent is so low, according to analysts at FGE, an energy consultancy.

The spread “should be fast-approaching a floor and we see support on the horizon” as Brent steadies along with financial markets, FGE said. Bank stocks have recovered a small part of their losses week after the state-led rescue of Credit Suisse Group AG over the weekend.

--With assistance from Sharon Cho.

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