US Cash Crude-Mars climbs to 6-month high, WTI/Brent arb narrows for third session
Dec 16 (Reuters) -Grades broadly fell on Monday, dealers said, with Mars Sour bucking the downward trend and climbing to a six-month high, while a narrowing WTI/Brent spread indicated minimal transatlantic arbitrage opportunities.
Offshore grade, Mars Sour rose has been trending higher for the last six sessions, according to data from LSEG, hitting its highest on Monday since Jun. 25.
Meanwhile the spread between U.S. West Texas Intermediate and Brent crude narrowed for the third consecutive session, to as little as minus $3.57 per barrel, its narrowest point since Sept. 30.
A narrower spread between the global benchmark and WTI, particularly under minus $4 typically discourages transatlantic demand as traders see a closed arbitrage.
In refining news, Shell SHEL.L began restarting the crude distillation unit (CDU) at its 233,702 barrel-per-day (bpd) Norco, Louisiana, refinery, people familiar with plant operations said on Monday.
The 240,000-bpd CDU was shut on Thursday morning to repair a leak, the two sources said.
U.S. oil refiners are expected to have about 265,000 bpd of capacity offline in the week ending Dec. 20, decreasing available refining capacity by 171,000 bpd, research company IIR Energy said on Monday.
Offline capacity is expected to fall to 25,000 bpd in the week ending Dec. 27, IIR added.
On the supply side, U.S. crude oil and distillate stockpiles were expected to have fallen last week while gasoline inventories likely rose, a preliminary Reuters poll showed.
* Light Louisiana Sweet WTC-LLS for January delivery fell 2 cents to a midpoint of a $3.03 premium and was seen bid and offered between a $2.80 and $3.25 a barrel premium to U.S. crude futures CLc1
* Mars Sour WTC-MRS rose 35 cents to a midpoint of a $1.20 premium and was seen bid and offered between a $1.10 and $1.30 a barrel premium to U.S. crude futures CLc1
* WTI Midland WTC-WTM fell 15 cents to a midpoint of a 70-cent premium and was seen bid and offered between a 65-cent and 75-cent a barrel premium to U.S. crude futures CLc1
* West Texas Sour WTC-WTS fell 60 cents to a midpoint of a 45-cent discount and was seen bid and offered between a 55-cent and 35-cent a barrel discount to U.S. crude futures CLc1
* WTI at East Houston WTC-MEH, also known as MEH, traded between a $1.30 and $1.50 a barrel premium to U.S. crude futures CLc1
* ICE Brent February futures LCOc1 fell 58 cents to settle at $73.91 a barrel on Monday
* WTI January crude CLc1 futures fell 58 cents to settle at $70.71 a barrel
* The Brent/WTI spread WTCLc1-LCOc1 narrowed 4 cents to last trade at minus $3.63, after hitting a high of minus $3.57 and a low of minus $3.74
Reporting by Georgina McCartney in Houston; Editing by Stephen Coates
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