Light Louisiana Sweet on the spot market strengthened the day after it reached a nine-month low as Brent’s premium to the U.S. benchmark grew.
Brent widened its differential to West Texas Intermediate by 66 cents to $11.96 a barrel at 2:32 p.m. in New York. The spread settled at $11.30 yesterday, the smallest since July 22. It’s shrunk from $20.79 on March 5 as supplies have increased in the North Sea and West Africa while refiner demand has declined due to maintenance in Europe and Asia.
Brent is expected to strengthen over the next few months as refineries return from maintenance and domestic demand in the Middle East increases, limiting supply, Jan Stuart, head of energy research at Credit Suisse Group AG in New York, said in a note to clients yesterday.
LLS and other Gulf of Mexico crudes compete with foreign oils priced against Brent for space in U.S. Gulf Coast refineries.
LLS strengthened by 55 cents to a premium of $14.05 a barrel more than WTI in Cushing, Oklahoma, at 1:59 p.m. New York time, according to data compiled by Bloomberg. Yesterday the premium fell to $13.50, the weakest level since June 5. Heavy Louisiana Sweet strengthened by 25 cents to $14.80 a barrel more than WTI.
Mars Blend, a medium-sour crude from the Gulf, strengthened by 20 cents to $8.50 a barrel more than WTI. Its premium yesterday was the smallest since Jan. 26.
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