Physical grades slip as Brent/WTI spread narrows
USO•US physical oil grades mostly fell on Tuesday as the Brent/WTI spread narrowed by roughly $1 to minus $8.99. Brent futures settled at $103.60 a barrel and WTI at $96.09.
1. Crude grades weaken
Physical oil grades mostly fell on Tuesday as the spread between Brent crude futures and West Texas Intermediate narrowed. WTI Midland fell 5 cents to a 30-cent premium to US crude futures, while West Texas Sour traded at a $2.90 discount to WTI Midland, compared with a $1.05 discount the prior day.
2. Inventory data ahead
The US Energy Information Administration was due to release its weekly supply and demand report on Wednesday. A Reuters poll anticipated declines in US crude and gasoline inventories; the American Petroleum Institute said crude stocks fell 5.27 million barrels last week, gasoline stocks rose 1.43 million barrels and distillates fell 1.19 million barrels.
3. Futures and Iran pricing
ICE Brent January futures fell $1.17 to settle at $103.60 a barrel, while WTI December futures fell 37 cents to $96.09. Iran set its November official selling price for light oil to Asian buyers at a $6.90-a-barrel discount to the Oman/Dubai average, versus a $4.55 discount in October.
