Light Louisiana Sweet oil weakened for the fifth straight day, the longest losing streak of the year, as buyers anticipate the arrival to the U.S. Gulf Coast of similar, cheaper crude on the Seaway pipeline.
The premium of LLS against West Texas Intermediate oil narrowed 40 cents to $12.35 a barrel at 4:09 p.m. on the New York Mercantile Exchange, according to data compiled by Bloomberg.
The premium is the smallest since Jan. 31. The gap between the two oils narrowed seven days in a row in December.
Enbridge Inc. and Enterprise Products Partners LP are expected to start pumping crude south from Cushing, Oklahoma, to the Gulf Coast tomorrow, according to a filing with federal regulators. A steep rise in Canadian and Midwest U.S. oil production in recent years, combined with a lack of transportation out of the Cushing storage hub, have created a supply glut and low prices there.
Heavy Louisiana Sweet crude widened $2.25 to trade at a $16 premium to WTI. The premium for Mars Blend, a medium sour crude, grew 75 cents to $11.