Bakken crude weakened to the lowest level this year against U.S. benchmark West Texas Intermediate with the number of wells and the amount of production in the North Dakota shale formation at record highs.
Wells drilled in the Bakken grew to 562 from 556 in the first quarter, according to data from Bloomberg Industries. Monthly production also set a record in March, increasing 0.5 percent to 718,791 barrels a day, the state Industrial Commission said May 15.
“What you’re really starting to see is the advent of pad drilling,” said Christian O’Neill, an energy analyst in New York with Bloomberg Industries. “The companies have more time within these plays, they’re getting more and more efficient and their recovery rates are also steadily rising.”
Bakken fell $1 a barrel to $6 below WTI at 2:05 p.m. New York time, according to data compiled by Bloomberg. That’s the lowest level since Nov. 16.
Sweet oils produced in the Gulf Coast weakened against WTI and sour oils strengthened. Heavy Louisiana Sweet’s premium shrank by 5 cents a barrel to a premium of $8.25. Light Louisiana Sweet lost 15 cents a barrel to an $8.70 premium.
Southern Green Canyon gained 50 cents a barrel to a $2.50 premium. Poseidon’s premium rose 15 cents to $3.85. Mars Blend strengthened 35 cents to a premium of $4.25. Thunder Horse’s premium increased 10 cents to $6.60.