U.S. Cash Crude-Sour grades firm as Keystone outage prompts supply worries

US Physical Therapy

12/12/2022 22:07

Dec 12 (Reuters) - U.S. sour crude oil grades
strengthened on Monday as traders looked to snap up sour grades
after a shutdown of the Keystone pipeline worried markets about
heavy sour oil supply, dealers said.
    Mars Sour  WTC-MRS  firmed 10 cents to a discount of $5.60
to U.S. crude futures, while West Texas Sour also strengthened
35 cents to a $1.15 discount. Sweet grades broadly weakened. 
    TC Energy's  TRP.TO  Keystone pipeline, which ferries about
600,000 barrels of Canadian crude per day (bpd) to the United
States, remained shut since late on Wednesday after a breach
spewed more than 14,000 barrels of oil into a Kansas creek.
 urn:newsml:reuters.com:*:nL1N32Z1LP  urn:newsml:reuters.com:*:nL1N32Z26L
    With TC Energy yet to provide any clarity on a timeline for
the pipeline's restart, traders worried the shutdown would
hamper deliveries of Canadian heavy sour crude to the U.S.
storage hub in Cushing, Oklahoma, and to the Gulf, where it is
processed by refiners or exported.  urn:newsml:reuters.com:*:nL1N33218V
    Oil refiners could be forced to cut production in the coming
weeks if the pipeline does not restart by then, a crude analyst
said.
    Crude oil inventory in the Strategic Petroleum Reserve fell
by 4.7 million barrels in the week to Dec. 9 to 382.3 million,
its lowest since January 1984.    
    Oil output from the Permian shale basin in January is set to
touch a record 5.6 million barrels per day (bpd), the U.S.
forecast on Monday, but the increase was the smallest in seven
months.  urn:newsml:reuters.com:*:nL1N3321Q6
    * Light Louisiana Sweet  WTC-LLS  for January delivery fell
40 cents to a midpoint of a 60-cent premium and traded between a
40-cent and an 80-cent a barrel premium to U.S. crude futures
 CLc1 .    
    * Mars Sour  WTC-MRS  rose 10 cents to a midpoint of a $5.60
discount and traded between a $5.80 and $5.40 a barrel discount
to U.S. crude futures  CLc1 . 
    * WTI Midland  WTC-WTM  fell 25 cents to a midpoint of a
25-cent discount and traded between a 50-cent discount and flat
a barrel to U.S. crude futures  CLc1 .
    * West Texas Sour  WTC-WTS  rose 35 cents to a midpoint of a
$1.15 discount and traded between a $1.30 and $1 a barrel
discount to U.S. crude futures  CLc1 .
    * WTI at East Houston, also known as MEH, traded between a
20-cent and flat a barrel to WTI.
    * ICE Brent February  LCOc1  futures rose $1.89 to settle at
$77.99 a barrel.
    * WTI January crude  CLc1  futures rose $2.15 to settle at
$73.17 a barrel.
    * The Brent/WTI spread  WTCLc1-LCOc1  widened 18 cents to
settle at minus $4.71, after hitting a high of minus $4.37 and a
low of minus $4.95.
 (Reporting by Laila Kearney; Editing by Daniel Wallis and
Richard Chang)
 ((Laila.kearney@thomsonreuters.com; (917) 809-0054))