AMERICAS OIL: Medium Sour Diffs Narrow: Kpler

The WTI-Mars spread narrowed to $0.32/bbl this week, with medium sour Mars crude approaching parity with WTI, Kpler said.

• Reduced availability of medium and heavy sour grades in the USGC has continued to support Mars pricing.
• Refinery maintenance in the region, coupled with the addition of Shell’s Whale platform, may dampen some of Mars’ strength, Kpler cautioned.
• The recent outages due to colder weather may also be bearish for medium crudes like Mars, Platts said. Medium crude runs will be cut by around 300k b/d due to outages at the Port Arthur and Garyville refineries, according to Platts data.
• However, the broader tightness of sour supply in the US is expected to drive a reversal of the spread, with Mars pricing likely to push above WTI in the near term, Kpler added.