U.S. Gulf Coast oils narrowed their premiums to West Texas Intermediate as the spread between WTI and Brent crude narrowed.
Brent’s premium to WTI narrowed 27 cents to $15.43 a barrel at 5:01 p.m. in New York, based on futures contracts for April delivery. The spread has narrowed 25 percent since Feb. 7, when it rose to $20.70 in intraday trading, the widest since Oct. 24.
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.
Heavy Louisiana Sweet (USCSHLSE)’s premium to the U.S. benchmark narrowed $3 to $18.50 a barrel at 4.03 p.m., according to data compiled by Bloomberg.
Light Louisiana Sweet (USCSLLSS)’s premium dropped $3.95 to $16.70 a barrel. The grade switched to April delivery from March starting today, which may have distorted the differentials, said Andy Lipow, president of Lipow Oil Associates in Houston.
Thunder Horse’s premium to WTI narrowed $2 to $16 and Mars Blend’s widened 15 cents to $13.05. Poseidon (USCSPOSE)’s premium widened 10 cents to $12.35 a barrel. Southern Green Canyon (USCSSGCN)’s premium narrowed $1 to $12.25 a barrel over WTI.
West Texas Sour (USCSWTSM)’s discount narrowed $1.50 to $3.50 a barrel.
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