Vitol to Export First US Oil Cargo, US WTI Hits Premium over Brent

Vitol to Export First US Oil Cargo, US WTI Hits Premium over Brent

Switzerland-based Vitol has been announced to load the first US export cargo after 40 years from the Enterprise Products Partners’ Houston terminal in the first week of 2016, Platts reported citing an Enterprise statement.

Enterprise will ship 600,000 barrels of domestic light crude oil and provide pipeline and marine terminal services for the cargo. Vitol will most likely send the cargo to its European subsidiary refinery in Cressier, according to sources familiar with the transaction, Bloomberg wrote. The US had earlier lifted a decade long oil export ban in mid December.

RT informed that US export may come in relatively small amounts of light crude, as the country still heavily relies on crude imports. US produces 9.4mb/d, while consumes nearly 20mb/d.

Meanwhile, prices of International Brent and US crude futures fell in the post-Christmas week, with US West Texas Intermediate (WTI) being traded at $37.91 per ton, down $0.19, having defended its newly acquired premium over Brent that hit the $37.71-a-barrel level, Reuters reported. The US WTI has come to the forefront over reduced drilling activity, withdrawals from near record crude stockpiles, and the prospect of crude exports following the lifting of export ban. The prices continue dropping for the fourth consecutive day, according to another report published by Reuters.

The prices of both benchmarks have dropped by around 67% since mid 2014. Traders cited by Reuters in related news said that prices could continue moving abruptly without changes in price fundamentals. The movement on the international market occurs amid oversupplies as large oil actors produce up to 2mb/d of crude in excess of demand.


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