June 10, 2015 – Reuters
Disappearing Bakken oil discount adds to output slowdown signs
By Catherine Ngai
NEW YORK (Reuters) - Oil traders scrambling to secure crude in the U.S. Midwest have pushed North Dakota's Bakken to a near premium for the first time in two years, a rally stoked by record refinery runs and an unprecedented slump in Canadian imports.
Read the full story here: http://finance.yahoo.com/news/disappearing-bakken-oil-discount-adds-output-slowdown-signs-041144456--finance.html
LOOKING ABROAD
It is unclear how long the strength may last. Canadian production is already recovering and Midwest refinery runs <REFCR-2-EIA> have fallen for the past three weeks.
In addition, traders say elevated Bakken prices have priced out East Coast refiners that have been buying about a third of output, EIA data shows.
Just last week, the Bakken and West Africa Qua-Iboe <BFO-QUA> differential tightened to the smallest since June 2013. With the arbitrage opening for imported crude, Bakken barrels may soon be seeking new homes.
"The question is just how fast are people reacting?" said Sandy Fielden at RBN Energy. "How quickly are people jumping off rail and into pipeline? For the short term, there's more demand from Midwest refiners. But will it stay?"
