* Harvey closed nearly a quarter of U.S. refining capacity
* That helped push WTI-Brent spread to widest in two years
* But Asia traders may wait for US spot prices to ease further
By Florence Tan
SINGAPORE, Sept 6 (Reuters) - Some oil traders in Asia are looking to snap up crude cargoes from the United States after Hurricane Harvey closed U.S. refineries, denting local demand and pushing out the price spread between U.S and Atlantic Basin crude benchmarks.
Hurricane Harvey barreled into the U.S. Gulf of Mexico coast around 10 days ago, closing nearly a quarter of the nation's refining capacity, although some of that is now coming back online.
Trade sources said the closures pushed the prompt-month spread between West Texas Intermediate crude and Brent crude to the widest in two years at nearly $6 a barrel last week, pushing Asian traders to hunt for competitively priced U.S crude. However, some said spot prices would need to ease further before traders fixed cargoes for the journey east.
"One good piece of news is that the WTI-Brent spread has blown out so much that means excess U.S. crude is going to be exported," said Tony Nunan, oil risk manager at Mitsubishi Corp in Tokyo.
"It looks like there wasn't much damage to export facilities and they should come back up quicker (than expected)."
Prices for WTI light grades were the weakest and they could head to Asia first, said a Singapore-based trader, declining to be identified as he was not authorised to speak with media.
Still, the market is evolving daily with spot levels for WTI Midland WTC-WTM rebounding on Tuesday after several refineries restarted post-Harvey.
Taiwanese refiner Formosa Petrochemical Corp could consider buying from the United States.
"We're watching the situation," spokesman KY Lin told Reuters.
"U.S. crude's length may worsen and put more downward pressure on prices in the next two weeks."
Spot premiums for Mars WTC-MRS, another grade that's popular with Asian refiners, edged down on Tuesday from more than two-year highs as more tankers were allowed to offload sour grades in the Gulf.
Companies that often ship U.S. crude to Asia include BP , Chevron Corp, Trafigura, Mercuria and Occidental in addition to North Asian refiners Unipec, PetroChina, JXTG , Cosmo Energy, GS Caltex and SK Energy.
Reporting by Florence Tan; Additional reporting by Aaron Sheldrick in Tokyo; Editing by Joseph Radford