Brent-WTI Spread Explained -- Again

Deutsche Bank explains the spread.

Just for the record, the folks following the Bakken shale story had already figured it out, and solutions were provided.

Increased pipeline capacity to bring crude oil to Cushing, Okla., has resulted in more oil flowing into PADD 2 than the refinery system there can handle, and therefore the landlocked crude is trading at a persistently wide discount to comparable global crudes.

The current Brent-West Texas Intermediate spread is about $15/bbl. And although the spread corrects over the life of the futures curve, the price of WTI crude has moved structurally to a discount to Brent crude in a reversal of the historic premium that WTI has enjoyed.

It's also been reported at this website that the Keystone XL will alleviate the excess oil building up at Cushing.

CNBC's explanation.