I am sorry but that was written by someone not understanding the market.
WTI is significantly cheaper than imported crude ONLY because it is mostly land-locked AWAY from the coast. The same grade oil, or even the same oil, at the coast is worth essentially the same as the sweet, light imported oil.
It is not cheaper for any other reason. If it was not bottlenecked in relation to supply versus coastal demand, there would be no discount. That was the case just 4 years ago before the Bakken and other West Texas supplies started to really climb.
But due to the Jones Act could not even if they wanted to.
Jones Act doesn't matter when there is no surplus supply on the coast.
Look at the price difference between WTI and LLS (Louisiana Light, Sweet at St. James, Gulf Coast).
Today the LLS is a premium over WTI ~$16.
http://online.wsj.com/mdc/public/page/2_3023-cashprices.html?mod=topnav_2_3000
Four years ago, prior to the over-supply to Cushing, the price difference was less than $4.
http://online.wsj.com/mdc/public/page/2_3023-cashprices-20080509.html?mod=mdc_pastcalendar
WTI is only discounted because it is bottlednecked to the coast. The condition will not last; there are multiple pipeline projects underway to take more oil from Cushing to the Coast. At the time the bottleneck is eliminated, there will not be any significant discount.
But far more important, there is no surplus of supply to ship to another area. 100% of WTI is already being used and is still ~5 million barrels a day short of meeting the area demand. It is not going to get shipped anywhere else.
Please remember, by definition, WTI trading is not only a grade of oil, but also a location, Cushing Oklahoma. The same oil at the coast has a different value.
Thank you for your patience, I’m trying to really understand the industry and all its aspects. By reading everything I can I’m trying to self educate.