NEW YORK ( TheStreet) -- For much of Friday -- before the dip of both WTI and Brent -- crude oil contracts were mixed as technical breakthroughs and talk of more glut relief in the Midwest came to favor one over the other.
West Texas Intermediate (WTI) light sweet crude oil for November delivery had bounced 96 cents to $83.55 a barrel as technical momentum got added mileage from growing attention to the fact that refiners are increasingly doing whatever they can to get a hold of the discounted WTI -- even through unconventional methods of transportation -- given that it's a lot cheaper than other oil options right now.
WTI, of course, remains discounted to Brent these days, as much of the WTI oil remains trapped in the Midwest due to a lack of pipeline infrastructure, resulting in a glut of supply.
Also helping WTI prices Friday was talk among traders that Canada may have to start rationing some grades of western Canadian light crude oil, which compete head-to-head with WTI, as pricing drops to the mid-$70 area.The December Brent crude contract, on the other hand, drifted $1.25 lower to $102.95 as traders unwound WTI-Brent spread trades and frowned on the global benchmark's exposure to the dire situation of the eurozone and potential ramp-up of Libyan oil supply. The contract broke below the $23 WTI-Brent spread level Friday -- the typical discount at which WTI has been trading to Brent. After breaking short-term support levels the day before, there has been a "big-time follow-through," TAC Energy trader Mark Anderle said of WTI. WTI is on a "technical tear," he said earlier today. In addition, "the physical market is healing a glut," he added. As for Brent's break below the $23 differential with WTI, Anderle said, "there's so much money in that spread trade that when it starts to correct, it moves quickly ... quick unwinding." Recently, there's been a significant increase in the number of unconventional vehicles -- rail, barges and trucks -- with trucks often grouped under the same category as barges -- being sent to the Midwest to deliver the trapped WTI crude oil to the Gulf Goast. "If you are a U.S. oil refiner and you can get your hands on rails, trucks and barges ...