Western Canada heavy oil differential narrows

Categories: Canada

Railcars holding crude oil

Western Canada Select (WCS) heavy crude’s discount to the benchmark West Texas Intermediate (WTI) narrowed on Thursday.

WCS for June delivery in Hardisty, Alberta, ended the day at $13.10 a barrel under the benchmark, according to brokerage CalRock. On Wednesday the Canadian heavy benchmark ended at $13.45 a barrel under WTI.

The heavy crude benchmark has tightened this week on concerns about wildfires in Alberta, although the wildfires have recently eased, allowing some producers to reopen shuttered production.

Canadian heavy oil prices have steadily improved this year relative to WTI due to improved transport to the United States and the restart of two Midwest refineries that are big buyers, RBN Energy analyst Martin King said.

Global oil prices slid as a political standoff over the U.S. debt ceiling stoked recession jitters in the world’s biggest oil consumer, while rising U.S. jobless claims weighed on sentiment.

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