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15 Jan 2015
Convergence between WTI and Brent developments - BBH
FXStreet (Guatemala) - Analysts at Brown Brothers Harriman explained that an important development has been the the convergence between WTI and Brent.
Key Quotes:
"There are several factors at work. Some participants expect the US output to slow faster than the rest of the world's production".
"OPEC wants to Brent to fall below WTI".
"Over time, this will encourage US refineries to process Brent over domestic output, squeezing US producers more".
"At the same time, there appears to be growing speculation that the US will lift, or at least modify its ban on crude exports. This is also seen to be relatively supportive for WTI over Brent".
Key Quotes:
"There are several factors at work. Some participants expect the US output to slow faster than the rest of the world's production".
"OPEC wants to Brent to fall below WTI".
"Over time, this will encourage US refineries to process Brent over domestic output, squeezing US producers more".
"At the same time, there appears to be growing speculation that the US will lift, or at least modify its ban on crude exports. This is also seen to be relatively supportive for WTI over Brent".