Western Canada Select plummeted 7.26% to $23.75.
Just outside Chicago, in Whiting Indiana, BP’s Whiting Refinery closed for undisclosed reasons this past Saturday.
The 405,000-barrels-per-day Whiting Refinery shutdown comes at the same time as the refining industry goes through seasonal turnaround in which facilities trim throughput for maintenance and infrastructure upgrades.
A crude trader in Calgary who wished to remain anonymous was quoted as saying “combined, refinery turnarounds and the BP Whiting issue have put downward pressure on WCS prices and has contributed to the widening differential with WTI.”
With WTI trading at $43.50, the WCS differential today stands at roughly $20/bbl.
The timing for Whiting’s problems is not good, as most refinery’s have delayed their fall 2015 turnaround to 2016 to take advantage of good refining margins.
The Whiting refinery is the largest single American processor of Canadian crude, the refinery took roughly 10% of US Crude imports from Canada from December through May of this year.