Last Friday marked the first day of the June physical trade cycle. Magellan East Houston’s (MEH) premium to West Texas Intermediate (WTI) jumped to $2.17/bbl on Monday April 29 while our joint venture partner Link Data Services pegged Midland WTI differential trading at $0.93/bbl, widening the MEH/Midland spread to $1.24/bbl as depicted by the red dashed oval below. We haven’t seen the MEH/Midland spread this wide in nearly four years. The largest crude oil pipeline exiting the Permian Basin by volume — Wink to Webster (W2W) — is planning to be offline for maintenance for ten days in June. This is inclusive of Enterprise’s Midland-to-ECHO III pipeline, which reflects the company’s undivided joint interest in W2W. Together with ME III, it’s our understanding that 1.5 MMb/d of capacity from the Permian Basin to Houston will be offline (see Glimpse of The Future for more details).
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Glimpse of the Future - Upcoming W2W Maintenance Will Tighten Permian Oil Takeaway, Wreak Havoc on Prices
The largest crude oil pipeline exiting the Permian Basin by volume — Wink to Webster (W2W) — is planned to be offline for maintenance for the first 10 days of June. This is inclusive of Enterprise’s Midland-to-ECHO III (ME III), which reflects the company’s 29% undivided joint interest in W2W. Although the outage has not been publicly confirmed, it’s our understanding that 1.5 MMb/d of capacity will be offline to reroute a small section of pipeline. In today’s RBN blog, we’ll examine how the planned maintenance will impact Permian Basin oil takeaway capacity and what it may mean for Midland WTI pricing.
Wink-to-Webster Maintenance in Rearview Mirror as Full Operations Restored
Little Things Mean a Lot - Leak at ECHO Terminal Highlights Crude Market Sensitivity
A crude oil leak last Tuesday at the Enterprise Crude Houston (ECHO) terminal disrupted regional flows and caused crude differentials to move higher over the course of the week. While the spill was swiftly addressed by terminal owner Enterprise Products Partners, it still affected inbound and outbound operations for a few days. In today’s RBN blog, we discuss the role of the ECHO terminal and show how even an isolated incident can quickly have an impact on the market.
