Wyoming crude discount wider amid refinery outage

Light Sweet Guernsey widened its daily discount to the CMA Nymex in Wyoming by 35¢/bl Tuesday as a refinery outage weighs on crude demand regionally.

The light sweet grade's daily volume-weighted average discount was 40¢/bl to the CMA Nymex. Over the session trades were completed from CMA Nymex -0.20 to -0.50.

Suncor's 103,000 b/d refinery in Commerce City, Colorado, has been off line since 24 December following severe winter weather damage and later a fire on 27 December. Suncor expects full operations to start late this quarter.

With the Colorado City refinery off line, significant regional crude supply will need to find another outlet, which may congest takeaway capacity from Guernsey, Wyoming.

During the January trade month that ended on 23 December ahead of the Commerce shutdown, Light Sweet Guernsey averaged about 60¢/bl over the January CMA Nymex. But after starting the February trade month at CMA Nymex +0.38 on 27 December, Light Sweet Guersey has fallen by nearly 80¢/bl against the basis.

The Argus Light Sweet Guernsey price assessment includes trade at six terminals in Guernsey, Wyoming, for Light Sweet, Rocky Mountain Sweet, Powder River Sweet and Bakken Light Sweet. Most of the trade reported has been Light Sweet at Guernsey since Argus launched the assessment with the start to the November US pipeline trade month on 26 September.

Argus launched a cumulative volume-weighted average for the grade this week in addition to the daily volume-weighted price. The new assessment is a volume-weighted averages of all deals done for grades included in the Light Sweet Guernsey price during the entire US pipeline trade month.

The Light Sweet Guernsey cumulative volume-weighted average fell by 9¢/bl from Monday to CMA Nymex -0.24 Tuesday. This reflected 37,500 b/d reported for February to date.

Argus also launched cumulative volume-weighted average assessments for Bakken DAPL in North Dakota and Bakken Patoka in Illinois this week.

By Amanda Smith