I Got Storage (I Feel Good) – Evolving Gulf Coast Crude Pricing and New Pipelines To St. James

A year ago (April 2015) the price spread between Light Louisiana Sweet (LLS) the St. James, LA benchmark light crude and Permian West Texas Intermediate (WTI) delivered to Houston was roughly $2.50/Bbl. In the first quarter of 2016 – following the end of the crude export ban and the crash of crude prices below $40.bbl – that spread narrowed to 30 cents/Bbl. This price differential change has thrown a wrench into traditional Gulf Coast price relationships that encouraged the flow of crude east from Houston to Louisiana. Further changes are expected as pipeline projects due to be completed in the next two years will deliver Bakken and Permian crude direct to St. James. Today we wrap up our series on St. James with a look at changing crude prices and flows.

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