Poseidon Discounted Against WTI First Time in Almost 30 MonthsEliot Caroom
Poseidon crude fell to a discount versus West Texas Intermediate for the first time in almost 30 months as the spread between WTI and Brent hovered near the lowest level since January 2011.
Brent’s premium to West Texas Intermediate shrank 4 cents to $5.94 a barrel after breaking below $6 yesterday, as Enbridge Inc. worked to restore three pipelines in western Canada. The lines’ shutdown reduced the flows of Canadian oil and increased demand for crude from Cushing, Oklahoma, the delivery point for WTI contracts on the New York Mercantile Exchange.
Poseidon, a medium sour grade with about 200,000 barrels a day of production delivered to tanks and pipelines in Louisiana, competes with foreign oils priced against Brent. It weakened by 10 cents to a 10-cent-a-barrel discount to WTI at 1:55 p.m. in New York, according to data compiled by Bloomberg. The last time it traded at a discount was Jan. 3, 2011.
Heavy Louisiana Sweet’s premium shrank 35 cents to $6.85 a barrel more than WTI.
Light Louisiana Sweet, the benchmark light, sweet crude on the Gulf Coast, increased 10 cents to a premium of $7.90 a barrel over WTI. Thunder Horse strengthened by $1 to $5 a barrel more than WTI.
Mars Blend’s premium grew by 5 cents to 75 cents a barrel more than WTI. Crude from the Southern Green Canyon gained 50 cents to a premium of 75 cents to WTI.
Bakken crude priced in Clearbrook, Minnesota, weakened by 25 cents to a discount of $3 a barrel less than WTI.
There were few trades in the Canadian crudes Western Canadian Select or Syncrude as of 11:59 a.m. local time on Net Energy Inc., a Calgary-based online oil exchange, after many offices in downtown Calgary were vacated after power failures caused by flooding in the city.