Brent-WTI to narrow as Cushing flows normalize

During the week ended 9/22 US crude inventories experienced the first stock draw since prior to Hurricane Harvey. This was a function of record high crude exports and rebounding crude runs. The strong EIA data helped to narrow the Brent-WTI spread ~75c after release, but still currently hovers near $5.50, near a two year high. We expect a number of factors to continue driving down the spread in the coming including continued recovering US crude runs aided by postponed fall refinery maintenance, continued tightening of US inventories to pre-Harvey levels aided by robust exports, and normalizing crude flows between Cushing and Houston, helping to support benchmark WTI prices.