Tag Archives: Crude Oil

Saudis to extend crude oil cuts

Oil Pumps

Important Takeaways:

  • Saudi Arabia to extend voluntary 1 million barrel per day crude oil production cut into September
  • Heavyweight oil producer Saudi Arabia will extend a 1 million barrel per day voluntary crude output cut into September, in the third month of such declines, the state-owned Saudi Press Agency said Thursday.
  • “In effect, the Kingdom’s production for the month of September 2023 will be approximately 9 million barrels per day,” it said, citing a source from the Saudi Ministry of Energy.
  • The 1 million barrel per day cut, which was also implemented in July and August, “can be extended or extended and deepened,” SPA said.

Read the original article by clicking here.

Crude oil hits new record high as gas prices continue to rise

Rev 6:6 NAS “And I heard something like a voice in the center of the four living creatures saying, “A quart of wheat for a denarius, and three quarts of barley for a denarius; and do not damage the oil and the wine.”

Important Takeaways:

  • Gas prices surge 25 cents in a week, hitting new record
  • There are now 10 states where the average price of gasoline is $5 a gallon or higher, with the latest being Michigan and Indiana. Washington, DC, is also above $5, according to CNN.
  • Georgia is the only state with an average below $4.30 a gallon.
  • Veteran oil analyst Andy Lipow told CNN he expects the national average to hit $5.05 a gallon in the next ten days.
  • US crude jumped to a fresh three-month high of $120.99 a barrel
  • Mark Zandi, chief economist at Moody’s Analytics “If oil prices go to $150, we are going into recession. There is no way out”

Read the original article by clicking here.

As tensions rise with Ukraine and Russia expect gas prices to go up

Rev 6:6 NAS And I heard something like a voice in the center of the four living creatures saying, “A quart of wheat for a denarius, and three quarts of barley for a denarius; and do not damage the oil and the wine.”

Important Takeaways:

  • Here comes $7 gas prices, warns oil strategist in dire outlook
  • Drivers best start bracing for another surge in gas prices amid the conflict between Russia and Ukraine and years of under-investment by the oil industry, warns one veteran energy strategist.
  • Energy Word founder Dan Dicker said on Yahoo Finance Live.
  • “My guess is that you are going to see $5 a gallon at any triple-digit [oil prices] … as soon as you get to $100. And you might get to $6.50 or $7.
  • Dicker said oil prices could shoot higher to $150 a barrel, or in line to the “super spike” highs from 2007.
  • WTI crude oil has climbed 13% in the past month to $94 a barrel. Russia produces 10 million barrels of oil a day, the equivalent of 10% of global demand. Any loss of that oil due to geopolitical issues could cause a tightly supplied market to become tighter, pushing prices for the hydrocarbon up.

Read the original article by clicking here.

U.S. demand for oil surges, depleting tanks in Oklahoma

By Stephanie Kelly

NEW YORK (Reuters) – Crude oil tanks at the Cushing, Oklahoma storage and delivery hub for U.S. crude futures are more depleted than they have been in the last three years, and prices of further dated oil contracts suggest they will stay lower for months.

U.S. demand for crude among refiners making gasoline and diesel has surged as the economy has recovered from the worst of the pandemic. Demand across the globe means other countries have looked to the United States for crude barrels, also boosting draws out of Cushing.

Analysts expect the draw on inventories to continue in the short-term, which could further boost U.S. crude prices <CLc1> that have already climbed by about 25% in the last two months. The discount on U.S. crude futures to the international Brent benchmark should stay narrow.

“Storage at Cushing alone has the potential to really rally the market to the moon,” said Bob Yawger, director of energy futures at Mizuho.

Cushing stockpiles have dropped to 27.3 million barrels, the lowest since October 2018, the Energy Information Administration said on Wednesday, or about half of where inventories were at this time a year ago.

Inventories have fallen because of a ramp-up in U.S. demand, which has encouraged domestic refiners to keep crude at home to provide fuel such as gasoline and distillates to U.S. consumers, said Reid I’Anson, senior commodity analyst at Kpler.

In addition, U.S. production has been slow to recover from declines seen in 2020. At the end of 2019, the nation was producing roughly 13 million barrels of oil per day (bpd), but in recent weeks has been less than 11.5 million bpd. At the same time, product supplied by refineries – a proxy for demand – is about just 1% below pre-pandemic peaks.

As a result, the spread between U.S. crude and Brent, has collapsed. The spread narrowed to roughly $1.09 a barrel this week from $4.47 earlier this month, which had been about the widest spread since May 2020.

In an additional sign of high short-term demand for U.S. crude, the premium for U.S. crude delivered this December versus December 2022 reached a high this week of $12.48 per barrel, most since at least 2014, according to Refinitiv Eikon data.

In the next three months, Rystad Energy expects refinery runs in the United States to increase by 500,000 to 600,000 barrels per day. This would outpace production gains of 300,000-400,000 bpd, and keep the spread between the two benchmarks narrow.

“Only if OPEC (the Organization of the Petroleum Exporting Countries) intervenes with more supply of crude or if COVID rears its ugly head again, curbing demand, this high volatility will come off,” said Mukesh Sahdev, senior vice president and head of downstream at Rystad Energy.

(Reporting by Stephanie Kelly; Editing by David Gregorio and Marguerita Choy)

Explainer: The Dakota Access Pipeline faces possible closure

By Devika Krishna Kumar and Stephanie Kelly

(Reuters) – A U.S. court could order the Dakota Access Pipeline (DAPL) shut in coming weeks, disrupting deliveries of crude oil, and making nearby rail traffic more congested.

WHAT IS DAPL?

The 570,000-barrel-per-day (bpd) Dakota Access pipeline, or DAPL, is the largest oil pipeline out of the Bakken shale basin and has been locked in a legal battle with Native American tribes over whether the line can stay open after a judge scrapped a key environmental permit last year.

A federal judge ordered the U.S. Army Corps of Engineers to update the court on its environmental review of the pipeline by May 3 and decide if it believes the line should shut during the process.

WHAT IS THE DISPUTE?

Native American tribes long opposed to DAPL say the line endangers Lake Oahe, a critical water source. Pipeline construction under the lake was finished in early 2017 and the line is currently operating. But a judge last year vacated a key permit allowing that service, raising the possibility that the line could close while a thorough environmental review was completed.

Dakota Access oil pipeline’s operators plan to ask the U.S. Supreme Court to intervene, according to a court filing last week.

WHAT ARE THE CHANCES THAT THE LINE WILL CLOSE?

So far, the U.S. Army Corps of Engineers has not requested the line to be closed, even after the federal permit was canceled. It expects to complete the environmental review by March. Market analysts believe there is some chance the judge orders the line closed, and there is concern about the disruption that would cause.

WHAT WILL OIL PRODUCERS DO IF THE LINE IS CLOSED?

The U.S. shale boom created more demand for rail transport of crude in North Dakota, the second-biggest oil producing state in the country. Outbound rail traffic rose by almost 300% between 2002 and 2015, a North Dakota Department of Transportation report showed.

However, rail is expensive and takes longer to ship, making pipelines the preferred shipping method. If DAPL were to shut, producers would be pushed toward crude by rail again, BTU Analytics said.

WHAT COULD HAPPEN FOR FARMERS IF THE LINE IS SHUT?

If shippers divert oil shipments onto railcars, it will create transport bottlenecks in the region, especially in North Dakota, which relies on rail to transport over 70% of its agricultural production, economists and industry sources said.

“Probably more grain would be piled on the ground until the time it could be moved by rail,” said Jeff Thompson, a farmer in South Dakota and a director of the South Dakota Soybean Association, which supports DAPL.

In 2019, North Dakota led the nation in the production of all dry edible beans, canola, durum wheat, and spring wheat. The state is a captive rail market, which means there are no other economically viable options to deliver agricultural products, said Stu Letcher of the North Dakota Grain Dealers Association.

ARE RAILROADS PREPARED?

Railroads have improved load capacity over the last decade in response to past constraints, said Bill Wilson, professor at North Dakota State University and a member of the North Dakota Soybean Council.

“I would be surprised that, if DAPL was shut down, that the railroads were not capable of handling that added business,” Wilson said.

BNSF Railway, which operates the greatest number of route-miles in North Dakota, is prepared to handle any increase in rail traffic if the DAPL is shut, the company said.

The other major railroad serving the region, Canadian Pacific Railway Ltd, is committed to delivering for customers across all businesses, said spokesman Andy Cummings.

(Reporting by Devika Krishna Kumar and Stephanie Kelly in New York; Editing by Aurora Ellis)

Clean crude? Oil firms use offsets to claim green barrels

By Timothy Gardner, Nerijus Adomaitis and Rod Nickel

(Reuters) -In January, Occidental Petroleum announced it had accomplished something no oil company had done before: It sold a shipload of crude that it said was 100% carbon-neutral.

While the two-million-barrel cargo to India was destined to produce more than a million tons of planet-warming carbon over its lifecycle, from well to tailpipe, the Texas-based driller said it had completely offset that impact by purchasing carbon credits.

Such credits are financial instruments generated by projects that reduce or avert greenhouse-gas emissions such as mass tree plantings or solar power farms. The projects’ owners can sell the credits to polluting companies, who then use them to make claims of offsetting their carbon emissions.

Details of the Occidental transaction have not been previously reported. Two sources involved in the deal told Reuters that the driller paid about $1.3 million for the credits – or about 65 cents per barrel. Oil currently sells for more than $60 a barrel.

Occidental says such credits make the two-million-barrel cargo carbon-neutral because they represent an equivalent amount of greenhouse gas removed from the atmosphere by the projects generating the credits.

The arrangement reflects a growing trend. Oil-and-gas companies worldwide are increasingly trying to market their products as cleaner using a range of controversial methods, including buying credits, powering drilling operations with renewable power and investing in expensive and commercially unproven technology to capture and store emissions.

The moves are designed to secure a future for the fossil fuel industry in a world where investors, activists and regulators demand action to stop climate change. In some cases they are also designed for profit: Companies have begun seeking a premium price for what they call cleaner petroleum products.

Although carbon credits do nothing to reduce the pollution from a given barrel of oil, proponents of offset programs argue that credit purchases help finance clean-energy efforts that otherwise would not be profitable.

Critics blast such programs as smoke-and-mirrors public relations efforts that allow polluters to scrub their image while they continue to profit from climate damage.

Oil company claims of clean fuels through offsetting are like “a tobacco company saying they sell nicotine-free cigarettes because they paid someone else to sell some chewing gum,” said David Turnbull, a spokesman for Washington-based Oil Change International, an advocacy group opposing fossil fuels.

NO CLEAR STANDARDS

National and global carbon credit programs establish guidelines that projects must follow to in order to sell offsets. The programs rely on companies and nonprofit organizations such as Verra and SustainCERT to issue and verify credits under their standards. They certify that the projects generating credits are leading to the promised amount of reduced emissions and would not have been built without the credit income.

But there are no uniform standards for how to calculate the full climate impact of fossil fuels, or how to properly offset it with environmental projects, industry experts say. Companies buying credits are also not obliged to disclose their cost or origin – a problem because they can vary widely in price and quality.

In Occidental’s case, the credits were generated between 2016 and 2019 by solar, wind and other clean-energy projects in emerging economies such as India, Thailand and Turkey, and were verified by Verra.

“The credits they issued are valid and have environmental integrity,” said Verra spokeswoman Anne Thiel.

Verra and other verifiers, however, have since stopped approving renewable energy projects in those nations to generate offsets after concluding last year that they had become competitive enough to be built even without offset credit revenue.

Occidental defended the deal, saying it could kick off a new market for oil offset with credits that directs money to green-energy projects. “We can be a big part of the global solution,” said Richard Jackson, Occidental’s president of operations for onshore resources and carbon management.

TREES IN SPAIN

Occidental and the cargo’s buyer, India’s Reliance Industries, did not comment on whether Reliance paid a premium for the shipment.

But other oil-and-gas companies are eager to create a market where climate credentials allow them to command higher prices. That could allow them to recoup the full cost – or more – of credits or other measures that allow for the low-carbon labeling.

Lundin Energy, an independent driller with operations in Norway, is one of the companies that sees a market opportunity in crude with a low-carbon designation.

The company plans to spend $35 million to plant 8 million trees in northern Spain and Ghana – something it says will allow it to generate its own credits to offset greenhouse gas emissions from its fossil fuels.

Lundin was the first oil company in the world last year to receive independent certification it was producing low-carbon oil based on its reduction of emissions in producing oil from its Edvard Grieg field in Norway. It also aims to certify low-carbon oil from the Sverdrup field, also in Norway – Western Europe’s biggest – which Lundin co-owns with a consortium of partners.

Cleaner drilling operations, however, have a limited environmental benefit. At least 80% of greenhouse gases from oil are emitted after extraction from the ground, according to consultancy IHS Markit.

Alex Budden, Lundin’s Vice-President, said if buyers paid a 1% premium for lower-carbon barrels, it would boost the company’s annual oil revenue by $10 million to $20 million. That would allow it to recover the costs of its offset and efficiency efforts and eventually profit from them.

So far there have been no takers. “But it’s going to happen,” Budden said.

GREEN OIL SANDS?

Across the Atlantic, Canadian producers in the oil sands have a bigger challenge. Producers there emit three to five times more carbon than the worldwide average because more energy is needed to extract the oil, according to Rystad Energy, a global consultancy. Its producers are hoping to change that.

Suncor Energy, for example, has pledged to cut the amount of carbon it emits per barrel produced 30% from 2014 levels by 2030 to contribute to Canada’s climate goals and address shareholder pressure to reduce its emissions.

It will do so by improving energy efficiency and investing in renewable energy technologies, such as wind farms, said Chief Sustainability Officer Martha Hall Findlay. She said Suncor will consider certifying those lower-carbon barrels.

“There’s no question carbon is our Achilles heel in the oil sands,” she said.

Liquefied natural gas producers are also increasingly marketing carbon-neutral LNG. Unlike in the oil market, some LNG buyers are already paying a premium for such cargoes.

In March, for example, Shell announced it had taken delivery of Europe’s first ever carbon-neutral cargo of LNG from Russian supplier Gazprom. Gazprom provided the gas and both companies chipped in for the offsets, said Mehdi Chennoufi, Shell’s head of LNG Origination and Business Development.

Shell said the credits came from projects that protect biodiversity or restore land, but it would not disclose the cost.

Buyers in Spain, Japan, Taiwan and China have also bought LNG certified as carbon-neutral, a trend that has led the International Group of LNG Importers, an association of big global LNG companies, to start working on standardized methodology.

“Today there is a lot of talk about carbon-neutral LNG, but there is no universal definition,” said Vincent Demoury, the group’s Deputy General Delegate.

Climate activist Andy Gheorghiu said the notion of carbon-neutral liquefied natural gas is like “vegan pork sausage.”

“It’s just nonsense,” he said.

Other companies are turning to carbon-capture technology – despite its history of high costs and operational difficulties – to offset their products’ climate impact.

Qatar, the world’s biggest LNG producer, announced in February that it is building a carbon-capture project at its North Field expansion project in the Persian Gulf.

Occidental is also developing the largest-ever direct-air-capture facility, to pull 500,000 tonnes per year of carbon dioxide out of the open air near some of its Texas oil fields, using fans and chemical reactions. That’s equal to the annual emissions from nearly 110,000 U.S. cars.

Environmentalists criticize such projects because they could extend the life of the fossil fuel industry.

If Occidental’s project works, for example, the company plans to pump the carbon back into the Texas oil fields, raising reservoir pressure to extract more crude.

Occidental says it hopes to market crude oil produced in this way as the feedstock for refining jet and marine fuel – providing a way for those industries to claim they have offset their emissions.

Marion Verles, Chief Executive Officer at SustainCERT, the credit verifier, said such offset schemes can help reduce overall greenhouse-gas emissions – but could also backfire.

Telling consumers they can consume carbon-neutral fossil fuels sends the message, she said, that “behavioral change is no longer needed.”

(Additional reporting by Shadia Nasralla, Nina Chestney, and Susanna Twidale in London; Kate Abnett in Brussels; Isla Binnie in Madrid; and Nidhi Verma in New Delhi; Editing by Richard Valdmanis and Brian Thevenot)

Oil prices slip as Hurricane Laura makes Gulf Coast landfall

By Ahmad Ghaddar

LONDON (Reuters) – Oil prices fell on Thursday as a massive hurricane in the Gulf of Mexico made landfall in the heart of the U.S. oil industry, forcing oil rigs and refineries to shut down.

Brent crude futures for October, which expire on Friday, fell 50 cents, or 1.1%, to $45.14 a barrel by 1359 GMT. The more active November Brent contract was down 55 cents, or 1.2%, at $45.61 per barrel.

U.S. West Texas Intermediate crude futures fell 39 cents or 0.9% to $43 a barrel.

Hurricane Laura made landfall early on Thursday in southwestern Louisiana as a category 4 storm, one of the most powerful to hit the state, with forecasters warning it could push a wall of water 40 miles inland from the sea.

Oil producers on Tuesday had shut 1.56 million barrels per day (bpd) of crude output, or 84% of the Gulf of Mexico’s production, evacuating 310 offshore facilities.

At the same time, refiners that convert nearly 2.33 million bpd of crude oil into fuel, and account for about 12% of U.S. processing, halted operations.

“Perhaps traders are waiting to see what the damage is but the limited impact so far may also just be a reflection of the current oil market dynamics. Temporary disruptions are easily covered,” OANDA analyst Craig Erlam said.

Oil prices also shrugged off U.S. crude inventory declines and signs that gasoline demand in the world’s biggest oil consumer were improving.

Crude oil stockpiles fell last week as exports soared the most in 18 months and refineries boosted production to the highest rate since March, Energy Information Administration data showed on Wednesday. Gasoline stocks also fell.

“It appears that the gasoline inventory reduction was due first and foremost to increased demand – gasoline demand rose to a six-month high of around 9.2 million bpd,” Commerzbank said.

(Additional reporting by Sonali Paul and Koustav Samanta; editing by Jason Neely)

U.S. removed almost 2.7 million barrels daily of Iranian oil from market: Pompeo

FILE PHOTO: U.S. Secretary of State Mike Pompeo reacts as he talks to the media after his meeting with Lebanon's Prime Minister Saad al-Hariri at the State Department in Washington, U.S., August 15, 2019. REUTERS/Yuri Gripas

WASHINGTON (Reuters) – The United States has removed nearly 2.7 million barrels of Iranian oil from global markets daily as a result of Washington’s decision to reimpose sanctions on all purchases of Iran’s crude, U.S. Secretary of State Mike Pompeo said on Tuesday.

In an interview with MSNBC, Pompeo said the U.S. government was confident it could continue with its strategy.

The United States re-imposed sanctions on Iran in November after pulling out of a 2015 nuclear accord between Tehran and six world powers. In May, Washington ended sanction waivers given to importers of Iranian oil, aiming to cut Tehran’s exports to zero.

Iran exported about 100,000 bpd of crude in July, according to an industry source who tracks such flows and data from Refinitiv Eikon. If condensate, a light oil, is included, shipments were about 120,000 bpd a day.

“We have managed to take almost 2.7 million barrels of crude oil off of the market, denying Iran the wealth to create their terror campaign around the world, and we have managed to keep the oil markets fully supplied,” Pompeo said.

“I am confident we can continue to do that,” he added.

The Organization of the Petroleum Exporting Countries (OPEC), Russia and other producers have been cutting 1.2 million bpd since Jan. 1 to reduce global supply. OPEC in July renewed the pact until March 2020 to avoid a build-up of inventories as worldwide demand is seen weakening.

Despite OPEC’s actions along with U.S. sanctions on Iran and Venezuela, Brent crude international oil prices <LCOc1> have been relatively weak, falling on Tuesday to $59 a barrel from a 2019 high of $75, pressured by concerns about slowing demand.

The exact level of Iranian exports has become harder to assess since U.S. sanctions returned in November, meaning estimates fall into a range rather than a definitive figure.

 

(Reporting by Humeyra Pamuk and Doina Chiacu in Washington; Editing by Paul Simao)

U.S. offers up to 6 million barrels of oil from emergency reserve

By Timothy Gardner

WASHINGTON (Reuters) – The U.S. Energy Department said on Thursday it is offering up to six million barrels of sweet crude oil from the national emergency reserve in a sale mandated by a previous law to raise funds to modernize the facility.

A law U.S. President Donald Trump signed last year requires the department to hold sales to fund $300 million improvements including work on shipping terminals to the Strategic Petroleum Reserve, or SPR, which is held in caverns on the coast of Texas and Louisiana. Previous laws have also mandated sales from the reserve, which currently holds more than 649 million barrels.

While global oil prices have been rising as the production group OPEC and Russia work together to cut supplies, the sale did not appear to be an explicit signal that the United States is looking to balance the current market with the SPR. U.S. Energy Secretary Rick Perry, who has said price impacts from tapping the reserve for supply balance are often temporary, did not mention the sale in a press conference earlier on Thursday.

Still, the oil supply could tighten in coming months with the Trump administration’s imposition of sanctions on crude exports from both Iran and Venezuela’s state-owned oil company, and with the producer supply cuts from OPEC and Russia.

The timing of the mandated sale may “serve as a warning to OPEC producers that a larger deployment of the SPR in the future could undermine,” efforts to boost the oil price, at least temporarily, analysts at ClearView Energy Partners said in a note.

The delivery period for the sale will be from May 1 to May 14 for oil from the reserve’s West Hackberry and Big Hill site, and from May 1 to May 31 from the Bryan Mound site. Offers for the oil must be received by March 13, the department said.

(Reporting by Timothy Gardner and Valerie Volcovici; editing by Chizu Nomiyama, Meredith Mazzilli and Susan Thomas)

Trump’s revenge: U.S. oil floods Europe, hurting OPEC and Russia

FILE PHOTO: A pump jack operates at a well site leased by Devon Energy Production Company near Guthrie, Oklahoma September 15, 2015. REUTERS/Nick Oxford/File Photo

By Olga Yagova and Libby George

MOSCOW/LONDON (Reuters) – As OPEC’s efforts to balance the oil market bear fruit, U.S. producers are reaping the benefits – and flooding Europe with a record amount of crude.

Russia paired with the Organization of the Petroleum Exporting Countries last year in cutting oil output jointly by 1.8 million barrels per day (bpd), a deal they say has largely rebalanced the market and one that has helped elevate benchmark Brent prices &lt;LCOc1&gt; close to four-year highs.

Now, the relatively high prices brought about by that pact, coupled with surging U.S. output, are making it harder to sell Russian, Nigerian and other oil grades in Europe, traders said.

“U.S. oil is on offer everywhere,” said a trader with a Mediterranean refiner, who regularly buys Russian and Caspian Sea crude and has recently started purchasing U.S. oil. “It puts local grades under a lot of pressure.”

U.S. oil output is expected to hit 10.7 million bpd this year, rivaling that of top producers Russia and Saudi Arabia.

In April, U.S. supplies to Europe are set to reach an all-time high of roughly 550,000 bpd (around 2.2 million tonnes), according to the Thomson Reuters Eikon trade flows monitor.

In January-April, U.S. supplies jumped four-fold year-on-year to 6.8 million tonnes, or 68 large Aframax tankers, according to the same data.

Trade sources said U.S. flows to Europe would keep rising, with U.S. barrels increasingly finding homes in foreign refineries, often at the expense of oil from OPEC or Russia.

In 2017, Europe took roughly 7 percent of U.S. crude exports, Reuters data showed, but the proportion has already risen to roughly 12 percent this year.

Top destinations include Britain, Italy and the Netherlands, with traders pointing to large imports by BP, Exxon Mobil and Valero.

Polish refiners PKN Orlen and Grupa Lotos and Norway’s Statoil are sampling U.S. grades, while other new buyers are likely, David Wech of Vienna-based JBC Energy consultancy said.

“There are a number of customers who still may test U.S. crude oil,” Wech said.

The gains for U.S. suppliers could come as a welcome development for U.S. President Donald Trump, who accused OPEC on Friday of “artificially” boosting oil prices.

“Looks like OPEC is at it again. With record amounts of Oil all over the place, including the fully loaded ships at sea. Oil prices are artificially Very High! No good and will not be accepted!” Trump wrote on Twitter.

‘KEY SUPPLY SOURCE’

While the United States lifted its oil export ban in late 2015, the move took time to gain traction among Europe’s traditional refineries, which were slow to diversify away from crude from the North Sea, West Africa and the Caspian.

“European refiners started experimenting with U.S. crude last year,” said Ehsan Ul-Haq, director of London-based consultancy Resource Economics. “Now, they know more than enough to process this crude.”

U.S. oil gained in popularity, sources said, in part because of the wide gap between West Texas Intermediate, the U.S. benchmark, and dated Brent, which is more expensive and sets the price for most of the world’s crude grades.

This gap, known as the Brent/WTI spread, has averaged $4.46 per barrel this year, nearly twice as high as the year-earlier figure, Reuters data showed.

Wech of JBC Energy said the spread would likely persist in the near future.

The most popular U.S. grades in Europe are WTI, Light Louisiana Sweet, Eagle Ford, Bakken and Mars.

Prices for alternative local grades have been slashed as a result.

CPC Blend differentials recently hit a six-year low versus dated Brent at minus $2 a barrel. Russia’s Urals also came under pressure despite the end of seasonal refinery maintenance. BFO-CPC BFO-URL-BFO-URL-NWE

WTI was available at 80-90 cent premiums delivered to Italy’s Augusta, well below offers of Azeri BTC at a premium of $1.60 a barrel, according to trading sources.

U.S. oil is even edging out North Sea Forties, which is produced in the backyard of the continent’s refineries.

Cargoes of WTI were offered in Rotterdam at premiums of around 50-60 cents a barrel above dated Brent, cheaper than Forties’ premium of 75 cents to dated.

(Additional reporting by Julia Payne and Devika Krishna Kumar; Editing by Dale Hudson)