NEW YORK, Dec 14 (Reuters) - U.S. cash crudes firmed on Monday as a contango widens in the futures market and WTI trades at a bigger discount to Brent crude.
U.S. crude futures fell for a ninth straight day on Monday, but product prices have not fallen at the same rate as crude, improving refining margins and spurring more demand for cash crude.
Mars sour traded for as much as 60 cents a barrel above West Texas Intermediate, up 90 cents from Friday's trading level of minus 30 cents. Light Louisiana Sweet rose 40 cents to $4.50 above WTI, while Bonito Sour rose 55 cents to $2.70 above.
U.S. crude futures fell 32 cents a barrel to $69.55 a barrel after settlement, with the front-month spread widening to a $2.33 a barrel discount to barrels for delivery a month later, up from a $2.08 a barrel discount on Friday.
WTI also weakened relative to Brent's front-month, trading at a discount of $2.29 a barrel, up from $2.10 on Friday.
WTI's weakness comes after crude inventories at its main delivery point in Cushing, Oklahoma, rose in six straight weeks through last week, according to U.S. government data.
Contango encourages buying of cash crude for storage purposes.
The nine-day slide in crude futures was the most consecutive days of falling oil prices since mid-2001. Another driver for cash crudes has been improving refining margins, which rose last week as crude prices fell quicker than product prices, according to a weekly report from Credit Suisse on Monday.
Margins rose $1.96 a barrel to $5.70 a barrel in the Midwest, and rose $1.17 a barrel to $7.06 a barrel in the Gulf Coast, the report said.
Among other cash grades, Heavy Louisiana Sweet sold for $3.25 a barrel above WTI, up from $1.75 a barrel above on Friday.
In the Midcontinent, WTI at Midland dealt for as much as 65 cents a barrel above WTI futures, delivered at Cushing, where stocks have risen in six consecutive weeks according to U.S. government data. The Midland grade had traded at 55 cents over WTI on Wednesday.
Southern Green Canyon rose $1.00 to minus 50 cents, while West Texas Sour rose 15 cents to minus $1.50.
California buyers lowered their posted prices by 35 cents a barrel.
See for Reuters' generic refining margins
See for the WTI front/second month spread
See for front month WTI/Brent futures spread
See for Reuters' assessment of Dated Brent
See for Reuters assessed tanker rates
See for assessed domestic crude differentials
See for outright U.S. cash crude prices
See for a list of U.S. refinery outages
See for U.S. EIA inventory reports and forecasts
See for recent cash crude deals --------------------------------------------------------------
(Reporting by Joshua Schneyer; Editing by Marguerita Choy)
((Email: joshua.schneyer@thomsonreuters.com; +1 646-223-6051; Reuters Messaging: joshua.schneyer.reuters.com@reuters.net)) Keywords: MARKETS USCRUDE (For help: Click 'Contact Us' in your desk top, click here or call 1-800-738-8377 for Reuters Products and 1-888-463-3383 for Thomson products; For client training: training.americas@thomsonreuters.com ; +1 646-223-5546) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
U.S. crude futures fell for a ninth straight day on Monday, but product prices have not fallen at the same rate as crude, improving refining margins and spurring more demand for cash crude.
Mars sour traded for as much as 60 cents a barrel above West Texas Intermediate, up 90 cents from Friday's trading level of minus 30 cents. Light Louisiana Sweet rose 40 cents to $4.50 above WTI, while Bonito Sour rose 55 cents to $2.70 above.
U.S. crude futures fell 32 cents a barrel to $69.55 a barrel after settlement, with the front-month spread widening to a $2.33 a barrel discount to barrels for delivery a month later, up from a $2.08 a barrel discount on Friday.
WTI also weakened relative to Brent's front-month, trading at a discount of $2.29 a barrel, up from $2.10 on Friday.
WTI's weakness comes after crude inventories at its main delivery point in Cushing, Oklahoma, rose in six straight weeks through last week, according to U.S. government data.
Contango encourages buying of cash crude for storage purposes.
The nine-day slide in crude futures was the most consecutive days of falling oil prices since mid-2001. Another driver for cash crudes has been improving refining margins, which rose last week as crude prices fell quicker than product prices, according to a weekly report from Credit Suisse on Monday.
Margins rose $1.96 a barrel to $5.70 a barrel in the Midwest, and rose $1.17 a barrel to $7.06 a barrel in the Gulf Coast, the report said.
Among other cash grades, Heavy Louisiana Sweet sold for $3.25 a barrel above WTI, up from $1.75 a barrel above on Friday.
In the Midcontinent, WTI at Midland dealt for as much as 65 cents a barrel above WTI futures, delivered at Cushing, where stocks have risen in six consecutive weeks according to U.S. government data. The Midland grade had traded at 55 cents over WTI on Wednesday.
Southern Green Canyon rose $1.00 to minus 50 cents, while West Texas Sour rose 15 cents to minus $1.50.
California buyers lowered their posted prices by 35 cents a barrel.
See for Reuters' generic refining margins
See for the WTI front/second month spread
See for front month WTI/Brent futures spread
See for Reuters' assessment of Dated Brent
See for Reuters assessed tanker rates
See for assessed domestic crude differentials
See for outright U.S. cash crude prices
See for a list of U.S. refinery outages
See for U.S. EIA inventory reports and forecasts
See for recent cash crude deals --------------------------------------------------------------
(Reporting by Joshua Schneyer; Editing by Marguerita Choy)
((Email: joshua.schneyer@thomsonreuters.com; +1 646-223-6051; Reuters Messaging: joshua.schneyer.reuters.com@reuters.net)) Keywords: MARKETS USCRUDE (For help: Click 'Contact Us' in your desk top, click here or call 1-800-738-8377 for Reuters Products and 1-888-463-3383 for Thomson products; For client training: training.americas@thomsonreuters.com ; +1 646-223-5546) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.