U.S. Cash Crude-Coastal grades firm on export demand

Reuters2021-08-14

Aug 13 (Reuters) - U.S. coastal crude grades strengthened on Friday as buying interest from Asia picked up, dealers said.

South Korean and Chinese refiners have snapped up at least 5 million barrels of U.S. Mars crude loading in September, taking advantage of lower prices in recent weeks, industry sources said.

Other grades such as West Texas Intermediate $(WTI)$ and West Texas Light $(WTL.AU)$ that regularly head east are also being booked for Asia, the sources said.

"We basically had nothing trade (in sour grades) in June and July and we have 5 million barrels going in August to all Eastern buyers," one U.S. crude exporter said.

A narrow spread between U.S. crude futures and international benchmark Brent had weighed on exports but pricing has recently become more favorable for shipments to Asia, traders and brokers said.

Among inland grades, WTI Midland and West Texas Sour weakened slightly on signs of production growth in the Permian basin.

U.S. energy firms added the most oil rigs in a week since April as the total rig count more than doubled from a record low a year ago amid a recovery in crude prices.

Enverus, a provider of energy data with its own closely watched rig count, said the number of active rigs increased by eight to 575 in the week to Aug. 11 with most of the increases in Appalachia and the Permian.

In refinery news, the large gasoline-producing fluidic catalytic cracker $(FCC.AU)$ is operating normally at Exxon Mobil Corp's XOM.N 560,500 barrel-per-day (bpd) Baytown, Texas refinery following a malfunction on Thursday, said sources familiar with plant operations.

Royal Dutch Shell Plc completed the restart of the gasoline-producing residual catalytic cracking unit (RCCU) at its 230,611 barrel-per-day (bpd) Norco, Louisiana refinery, sources familiar with plant operations said on Friday.

* Light Louisiana Sweet for September delivery fell 10 cents to a midpoint of 70 cents a barrel and traded between 60 cents and 80 cents a barrel premium to U.S. crude futures .

* Mars Sour rose 5 cents to a midpoint of $1.40 a barrel discount and traded between $1.50 and $1.30 a barrel discount to U.S. crude futures .

* WTI Midland fell 2.5 cents to a midpoint of 10 cents a barrel and traded between 5 cents and 15 cents a barrel premium to U.S. crude futures .

* West Texas Sour fell 5 cents to a midpoint of 25 cents a barrel discount and traded between 15 cents and 35 cents a barrel discount to U.S. crude futures .

* WTI at East Houston, also known as MEH, traded at 50 cents a barrel over WTI.

* ICE Brent October futures fell 72 cents to settle at $70.59 a barrel.

* WTI September crude futures fell 65 cents to settle at $68.44 a barrel.

* The Brent/WTI spread narrowed 3 cents to settle at minus $2.38, after hitting a high of minus $2.36 and a low of minus $2.54.

(Reporting by Devika Krishna Kumar in New York; editing by Grant McCool)

((devika.kumar@thomsonreuters.com; +1 646 223 6059; Reuters Messaging: devika.kumar.thomsonreuters.com@reuters.net))

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