Oil Fails to be Boosted by Higher Demand Outlook

Although WTI-Brent spread narrowed slightly yesterday, it continued to stay at a record level. The divergent movement of 2 benchmarks was driven by huge US inventories. Keystone pipeline crude flows into Cushing have dominated market sentiment currently. Meanwhile, the Bakken oilfield in North Dakota has increased production, making the US Mid-west very well-supplied. The distortion of WTI prices has once again raised question about the suitability of WTI crude as a world benchmark. Indeed, Saudi Arabia abandoned WTI for pricing to US customers 2 years ago.

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Oil Fails to be Boosted by Higher Demand Outlook