Eugene Island Crude Weakens as Shell Prepares to Restart PipeDan Murtaugh
Crude from the Eugene Island formation in the Gulf of Mexico weakened after a Royal Dutch Shell Plc said it expects to restart a pipeline that had been shutting in production of 38,000 barrels a day.
Shell is planning normal operations “in the coming days” for a 16-inch pipeline that carried crude from Caillou Island to Houma, Louisiana, Kim Windon, a Houston-based spokeswoman for the company, said in an e-mail. The pipeline is part of Shell’s Eugene Island system, and connects platforms in the Gulf to the mainland.
Shell shut the line March 25 after detecting a sheen in water near it. After conducting tests, it confirmed the leak was not related to the pipeline’s operations, Windon said.
Crude from the Eugene Island formation weakened by $2.10 to a premium of $10.90 a barrel above the U.S. benchmark in Cushing, Oklahoma, at 1:39 p.m. East Coast time, according to data compiled by Bloomberg. The premium is the lowest since July 3.
Mars Blend, a medium-sour crude from the Gulf, strengthened by 45 cents to a premium of $8.75 a barrel to WTI. Crude from the Poseidon formation gained 30 cents to $8.40 a barrel more than the U.S. benchmark.
Southern Green Canyon crude weakened 35 cents to $7.40 more than WTI while Thunder Horse lost 85 cents to a premium of $10.90 a barrel.
Light Louisiana Sweet, the benchmark for light, sweet crudes on the Gulf Coast, increased 15 cents to $14.05 a barrel more than WTI. Heavy Louisiana Sweet narrowed 15 cents to $13.95 above WTI.