- Italian refinery Saras receiving offers of several U.S. crudes
- Mars Blend among oil being offered to European refiners
U.S. oil exporters, back on the world market after a 40-year hiatus, should find steady demand in Europe if they can offer at least a $1.50 discount to benchmark Brent crude, the owner of one of Europe’s largest refineries said.
Saras Trading SA, owner of a 300,000-barrel-a-day refinery in Italy, is receiving offers of several grades of U.S. crude, including heavy Mars Blend, Marco Schiavetti, the company’s chief executive officer, said during an interview Wednesday at the U.S. Crude Exports Congress in Houston.
The U.S. government lifted its four-decade old ban on crude exports in December and shipments have since gone to the Netherlands, Israel and Nicaragua, among other destinations. Sales have suffered as the global oil glut sent prices tumbling, closing the gap between West Texas Intermediate and Brent. Still, American oil can compete when it sells at $1.50 to $2 less, Schiavetti said at the conference.
At a $1.50 discount, “the economics work," Schiavetti said. “We saw cargoes of WTI coming to Europe and we are continuously seeing inquiries from major oil companies and other producers."
As of Wednesday, WTI traded at a discount of $1.85 to Brent.
U.S. oil is likely to vie with light oil supplied from the Caspian Sea, Norway, the U.K. and West Africa, Schiavetti said at the conference. Saras, owner of the largest refinery on the Mediterranean, still hasn’t tested any U.S. crude in its facility but is considering its options, the CEO said. The company is based in Milan.