Similar to Brent-Dubai, WTI-Maya is another benchmark differential that has been seeing abnormal pricing this year. For much of 2019, WTI prices have trended below Maya crude prices, despite WTI’s higher quality. We expect that the differential will normalize in 2020 as Maya crude prices lose more value than WTI.
Unlike Brent-Dubai, WTI-Maya has had a much more amorphous history, with the differential evolving in line with US crude oil production. Before US crude oil exports were fully legalized WTI prices fell due to oversupply and a lack of regional pipeline capacity. After pipeline infrastructure was built out and exports legalized, WTI again held a premium to Maya. This year however, WTI has been held back by concerns of oversupply and a potential economic slowdown in the United States at the same time that physical disruptions have helped to support Maya.
WTI-Maya has averaged $(0.92)/bbl in 2019 (year to date), versus a five-year average of $5.12/bbl. For 2020, we expect the differential to average $3.60/bbl and remain at roughly that level through much of 2021 as well.
What Has Been Driving The New Pattern?
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