HOUSTON, Jan 6 (Reuters) - U.S. Gulf Coast grades remained weak on Tuesday, dealers said, as government officials in Caracas and Washington were discussing exporting Venezuelan crude to refiners in the United States, according to sources.
A deal could divert supplies away from China and add to heavy crude supplies along the U.S. Gulf Coast.
Mars, which competes with Venezuelan crude, traded at a $1.50 discount, while Southern Green Canyon eased 45 cents to minus $3.25.
Venezuela's main oil ports on Tuesday entered their fifth day without delivering crude for state-run PDVSA's customers in Asia, which are the OPEC country's main buyers, shipping data showed, as the U.S. presses the nation with an oil embargo.
Refiner Phillips 66 PSX.N can run Venezuelan crude at two U.S. Gulf Coast refineries as production ramps up, Chief Financial Officer Kevin Mitchell said on a conference call.
U.S. crude inventories fell last week while fuel stocks rose, market sources said, citing American Petroleum Institute figures on Tuesday.
Crude stocks fell by 2.77 million barrels in the week ended January 2, the sources said on condition of anonymity.
Meanwhile, Valero Energy VLO.N reported on Tuesday that a natural gas line at its 205,000 barrel-per-day Houston refinery sustained damage at approximately 1:15 p.m. local time, according to a community alert.
Light Louisiana Sweet for February delivery was flat at a midpoint of a $1.45 premium and was seen bid and offered between a 90-cent and $2.00 a barrel premium to U.S. crude futures CLc1
Mars Sour was flat at a midpoint of a $1.50 discount and was seen bid and offered between a $1.75 and $1.25 a barrel discount to U.S. crude futures CLc1
WTI Midland gained 10 cents to a midpoint of a 60-cent premium and was seen bid and offered between a 50-cent and 70-cent a barrel premium to U.S. crude futures CLc1
West Texas Sour eased 30 cents to a midpoint of a $1.90 discount and was seen bid and offered between a discount of $2.10 and $1.70 a barrel to U.S. crude futures CLc1
WTI at East Houston, also known as MEH, traded between a 65-cent and $1.05 a barrel premium to U.S. crude futures CLc1
ICE Brent March futures LCOc1 fell $1.06 to settle at $60.70 a barrel.
WTI February crude CLc1 futures fell $1.19 to settle at $57.13 a barrel.
The Brent/WTI spread widened 7 cents to last trade at minus $3.75, after hitting a high of minus $3.67 and a low of minus $3.77.
(Reporting by Arathy Somasekhar in Houston; Editing by Rod Nickel)
((arathy.s@tr.com))
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