BLBG:Oil Trades Near Six-Month Low as ECB Curtails Greek Banks
Oil climbed from a six-month low in New York as Enbridge Inc. (ENB) and Enterprise Products Partners LP (EPD) prepared to reverse flows on their Seaway pipeline, easing a glut in the central U.S.
West Texas Intermediate crude, the U.S. benchmark, rose as much as 1.2 percent on the day that the switch that will move barrels from Cushing, Oklahoma, to the Gulf Coast is scheduled to occur. Brent oil in London fell to the lowest level since Jan. 3 after Europe’s central bank suspended lending to some Greek firms and a report indicated Spanish banks may be downgraded.
“WTI is probably lower because the Seaway pipeline is starting today,” said Tom Bentz, a director with BNP Paribas Prime Brokerage Inc. in New York. “We’ve known it was going to start today for a while but there’s still a reaction.”
Crude oil for June delivery advanced 64 cents, or 0.7 percent, to $93.45 at 9:28 a.m. on the New York Mercantile Exchange. Futures yesterday dropped 1.2 percent to $92.81, the lowest close since Nov. 2.
Brent oil for July settlement slipped 32 cents, or 0.3 percent, to $109.43 a barrel on the London-based ICE Futures Europe exchange. The premium of the July Brent contract narrowed to a $15.61 premium to WTI in New York.
Enbridge and Enterprise are scheduled to reverse the Seaway pipeline today, according to an April filing with federal regulators. A rise in Canadian and Midwest U.S. oil production and limited transportation out of the Cushing storage hub have created a supply glut.
Prices dropped yesterday after U.S. stockpiles rose to the highest level since 1990 and a report signaled the nation may release emergency supplies. Crude inventories climbed 2.13 million barrels last week to 381.6 million, data from the Energy Department showed.
-- Editors: Margot Habiby, Charlotte Porter
To contact the reporters on this story: Mark Shenk in New York at mshenk1@bloomberg.net
To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net
