The premium for Light Louisiana Sweet crude narrowed to a 14-week low as sweet oil from the reversed Seaway pipeline was offered on the Gulf Coast.
The grade weakened as low-sulfur oil from the pipeline is being offered for June delivery at the July Brent price minus 50 cents a barrel, Andy Lipow, president of Lipow Oil Associates LLC in Houston, said in a phone interview.
Enterprise Product Partners LP (EPD:US) and Enbridge Inc. (ENB) are reversing Seaway and on May 17 will begin shipping oil from the storage hub at Cushing, Oklahoma, to the Gulf.
Light Louisiana Sweet’s premium to West Texas Intermediate lost 10 cents to $13.90 a barrel at 2:05 p.m. in New York, the lowest level since Feb. 1, according to data compiled by Bloomberg. LLS began trading at a discount to Brent on Wednesday for the first time since Feb. 9. That discount fell to $2.14 today.
“Over time LLS will come under pressure from the competition of all these other crudes coming to the Gulf Coast,” Lipow said. “This is just the start of it.”
Heavy Louisiana Sweet’s premium to WTI widened 40 cents to $15.40 a barrel.
Mars Blend’s premium narrowed 45 cents to $10.80 a barrel. Poseidon’s fell 35 cents to $9.90, and Southern Green Canyon’s fell 15 cents to $9.85.
Thunder Horse’s premium grew 50 cents to $15 a barrel.
Western Canada Select’s discount to WTI narrowed 25 cents to $18.75 a barrel.
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