West Texas Sour strengthened to the highest level versus domestic benchmark West Texas Intermediate since Oct. 3 after HollyFrontier Corp. executives said maintenance at the Navajo, New Mexico, refinery is complete.
HollyFrontier finished work on a crude unit, fluid catalytic cracker and alkylation unit at its 115,000-barrel-a- day refinery with units in Artesia and Lovington, David Lamp, the company’s chief operating officer, said in a conference call with analysts. The refinery processes heavy, sour and light, sweet crude and runs Permian Basin crudes, according to the company’s website.
West Texas Sour, a low-density, high-sulfur crude oil delivered in Midland, Texas, strengthened by $4 to a discount of $2.75 a barrel against WTI at 2 p.m. in New York, according to data compiled by Bloomberg. The gap has narrowed by $16.25 since Jan. 11.
“Refinery maintenance still has a way to go, but the people who are coming up are more likely to use WTS than they are to use WTI right now,” said Carl Larry, president of Houston-based Oil Outlooks & Opinions LLC. “If I have an opportunity to buy WTS now, I buy it now. I see my WTI prices are going to be low for the next month.”
Crudes produced in the Gulf of Mexico weakened as spot price assessments switched over to April-delivery oil.
Light Louisiana Sweet’s premium to WTI narrowed 60 cents to $20.55 a barrel for April delivery, and Heavy Louisiana Sweet’s premium fell 80 cents to $21.35.
Mars Blend’s premium fell 60 cents a barrel to $16.25. Thunder Horse, a sour crude with lower sulfur content than Mars, weakened $1.25 to a premium of $19.
Western Canada Select, a blend of oil-sands bitumen, weakened by 50 cents against WTI to a $25-a-barrel discount, according to data compiled by Bloomberg. Syncrude, a synthetic light, sweet oil upgraded from bitumen, was unchanged at a $2.50-a-barrel premium to WTI.
To contact the editor responsible for this story: Dan Stets at email@example.com