17 Mar 2015
Renewed widening of Brent-WTI spread likely – KBC
FXStreet (Barcelona) - According to KBC Bank, with US crude inventories rising, WTI might remain under pressure, which could widen the Brent-WTI spread in coming weeks.
Key Quotes
“Price of the US benchmark WTI fell to a new six-year low yesterday as the market probably revised its expectations for a rebound in crude oil prices due to persisting worries about crude supply glut.”
“Though the price spreads do not suggest any imminent problems with crude storage – globally, Reuters reported that some tankers booked for floating storage were even cancelled as it was not economical to store oil on sea – we continue to bet that there is still some room left for decline in (short-term) crude oil prices in weeks ahead.”
“We also think that a renewed widening of a spread between Brent and WTI is rather likely in weeks to come as we expect more pressure on WTI due to still relatively strong increase in US crude inventories.”
“As for the price of Brent, it also fell by about 2.3% yesterday while the contango in the front-end of the forward curve remained broadly stable as the April contract expired.”
Key Quotes
“Price of the US benchmark WTI fell to a new six-year low yesterday as the market probably revised its expectations for a rebound in crude oil prices due to persisting worries about crude supply glut.”
“Though the price spreads do not suggest any imminent problems with crude storage – globally, Reuters reported that some tankers booked for floating storage were even cancelled as it was not economical to store oil on sea – we continue to bet that there is still some room left for decline in (short-term) crude oil prices in weeks ahead.”
“We also think that a renewed widening of a spread between Brent and WTI is rather likely in weeks to come as we expect more pressure on WTI due to still relatively strong increase in US crude inventories.”
“As for the price of Brent, it also fell by about 2.3% yesterday while the contango in the front-end of the forward curve remained broadly stable as the April contract expired.”