U.S. Gulf Coast Oil Premiums Weaken as WTI-Brent Spread Narrows

U.S. Gulf oil premiums weakened as the difference between West Texas Intermediate and Brent narrowed.

The spread between the two benchmark crude futures for February delivery settled at $9.60 a barrel today. The January Brent contract expired yesterday. The difference between the January WTI and Brent contracts was $11.22 yesterday. The differential has narrowed 66 percent since reaching a record of $27.88 a barrel Oct. 14.

When Brent decreases versus WTI, it weakens the value of low-sulfur U.S. grades that compete with West African oil priced against the European benchmark.

Light Louisiana Sweet’s premium to WTI narrowed 90 cents to $10.50 a barrel at 3:45 p.m. in New York, according to data compiled by Bloomberg. Heavy Louisiana Sweet’s premium narrowed 85 cents to $10.25 a barrel.

Thunder Horse’s premium to WTI decreased $1.20 to $8.40. The premium for Mars Blend lost 20 cents to $7 a barrel. Poseidon’s premium narrowed 35 cents to $6.40 a barrel over WTI.

Southern Green Canyon’s premium decreased 90 cents to $5.85 a barrel and West Texas Sour’s discount was unchanged at 85 cents.

The discount for Western Canada Select was unchanged at $15.75 a barrel.

Syncrude’s premium narrowed 25 cents to $2.75 a barrel. Syncrude is a light, low-sulfur synthetic oil derived from the tar sands in Alberta.

To contact the reporter on this story: Aaron Clark in New York at aclark27@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.