Coastal grades weakened on Friday, dealers said, as the spread between U.S. West Texas Intermediate (WTI) and Brent crude shrank to below $4.
Mars Sour for October delivery fell 25 cents, while Light Louisiana Sweet fell 15 cents.
U.S. crude’s discount to Brent narrowed 18 cents to minus $3.91, settling below minus $4.00 for the first time in a week. A narrower discount discourages foreign buying of U.S.-linked grades.
Meanwhile, inland grades WTI Midland and West Texas Sour gained as oil rig counts remained weak.
The U.S. oil rig count rose by two this week to 515, the most since April, data from oilfield services firm Baker Hughes showed on Friday. Compared with a year ago, however, the oil rig count is down by 84 units, the data showed.
Markets also continued to worry about global supply after Saudi Arabia and Russia extended crude output cuts to the end of 2023.
In refining news, Marathon Petroleum restarted two key hydrotreaters on Friday at its 593,000 barrel-per-day (bpd) Galveston Bay refinery in Texas City, Texas, one day after a power interruption, people familiar with plant operations said.
Light Louisiana Sweet for October delivery fell 15 cents at a midpoint of a $2.40 premium and was seen bid and offered between a $2.20 and $2.60 a barrel premium to U.S. crude futures.
Mars Sour fell 25 cents at a midpoint of a 20-cent discount and was seen bid and offered between a discount of 40 cents and parity to U.S. crude futures.
WTI Midland gained 20 cents at a midpoint of a $1.8 premium and was seen bid and offered between a $1.60 and $2.00 a barrel premium to U.S. crude futures.
West Texas Sour gained 17.5 cents at a midpoint of a 5-cent premium and was seen bid and offered between a discount of 10 cents and 20-cent a barrel premium to U.S. crude futures.
WTI at East Houston, also known as MEH, traded between a $1.80 and $2.10 a barrel premium to U.S. crude futures CLc1
ICE Brent November futures rose 23 cents to settle at $93.93 a barrel on Friday.
WTI October crude futures rose 61 cents to settle at $90.77 a barrel on Friday.
The Brent/WTI spread narrowed 18 cents to minus $3.91, after hitting a high of minus $3.81 and a low of minus $4.08.
Source: Reuters (Reporting by Arathy Somasekhar in Houston, Editing by Matthew Lewis)