Stored oil keeps lid on cash crude diffs: traders

HOUSTON (Reuters) – The availability of crude oil stored on tankers at sea appears to be holding down U.S. cash crude differentials, industry sources said on Friday.

Shuttle tanker traffic has increased between tankers too large to enter U.S. ports and Gulf Coast refineries, suggesting some oil is moving into the onshore distribution network, tanker operators said.

“There are a couple of deals that came off this week, I guess due to the recent run-up in prices.” said a lighterer, who transfers oil from big ships at sea to smaller ones.

Key cash grade Light Louisiana Sweet has bounced between 50 cents and $2 a barrel over West Texas Intermediate in recent weeks. Normally, it sells at +$4 or more.

“The presence of floating cargoes probably caps the grades,” a trader said.

Reuters