The price differential between WTI and Brent has suddenly narrowed, putting the U.S. export boom at risk.
For much of last year, the two crude oil benchmarks traced one another pretty closely, with Brent often trading at a relatively minor $1 to $3 per barrel premium to its American counterpart. But the spread between the two blew out after Hurricane Harvey, an event that took several million barrels per day of refining capacity offline for a few weeks. Crude oil piled up into storage, and the glut pushed the WTI benchmark down relative to Brent.
The refineries along the Gulf Coast returned to operations within a relatively short period of time, but the effects of the disaster lingered. The differential hit a peak at over $8 per barrel in late September, but still traded at elevated levels for the rest of 2017.
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