My apologies again for the misstatement earlier this week about BPT and Brent pricing. I have a small BPT position and don't follow it closely enough. But, since the California producers, like BBEP and ROYT get Brent for their crude, how is it that BPT has to settle for WTI? I tried to figure it out but couldn't. What I did learn is that the oil leaves Valdez by Jones Act tanker and goes to the refineries in the Puget Sound. Looking at some pipeline maps, I see some pipes getting to the Seattle area - is this the reason for the WTI prices? Why not just continue the tanker on down a bit more to either the SF or LA refineries and get Brent?
I can only assume that since WTI was the gobal oil benchmark at the time the trust was formed (about 25 years ago), that it was used as the benchmark for the trust. WTI became the gobal oil benchmark in the early 80's and continued to be the benchmark until the last 3-5 years. Even the Saudi's changed over to brent crude as their benchmark around 5 years ago. Also, it was not until the last several years that the price between the two has varied so much.