Mars Weakens Against WTI as Shell Prepares for Pipeline WorkEliot Caroom
Mars Blend, an oil produced on the Gulf Coast, fell against domestic benchmark West Texas Intermediate as Royal Dutch Shell Plc prepared to shut a section of its Houston-to-Houma pipeline.
The line, nicknamed Ho-Ho, is being reversed and expanded to carry up to 250,000 barrels a day to Houma, Louisiana, from Texas by early 2014. Shell will begin the project’s second phase in August, closing a segment from Port Neches, Texas, to Houma, Destin Singleton, a Houston-based spokeswoman for Shell, said today. The work will be done by the end of 2013.
“Mars, which comes onshore in Louisiana, will no longer be able to access Lake Charles and Port Arthur refineries through the Ho-Ho line, and it may be seeking some alternative markets,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston.
Mars Blend fell $1.50 a barrel against WTI to a 50-cent discount at 2:26 p.m. in New York, according to data compiled by Bloomberg.
Light Louisiana Sweet sank 70 cents to a $5.40-a-barrel premium over WTI. Heavy Louisiana Sweet weakened by 60 cents to $5.20 above WTI.
Poseidon slipped $1.65 to a discount of 75 cents a barrel. Bonito Sour and Eugene Island both dropped $1.25 a barrel to a $2-a-barrel premium to WTI.
Crude from the Southern Green Canyon strengthened by 25 cents to a 75-cent premium to WTI. Thunder Horse was unchanged at a $4 premium.