Canadian heavy oil differentials narrowed slightly against the West Texas Intermediate (WTI) benchmark on Monday even as a portion of TransCanada's Keystone pipeline remained shut while officials searched for the source of a leak in Missouri:
* Western Canada Select (WCS) heavy blend crude for March delivery in Hardisty, Alberta, settled at $11 a barrel below WTI crude futures slightly narrower than Friday's settle at $11.45 below WTI, according to Net Energy Exchange.
* A portion of TransCanada Corp's Keystone oil pipeline between Steele City, Nebraska and Patoka, Illinois remained shut on Monday and the company said the cause and source of the spill near St Louis, Missouri, had not been determined. A company spokesman said there is no estimated timeline for a restart.
* Traders were caught off guard by the narrowing differential, with some speculating that winners of pipeline space from lotteries were scooping up barrels to meet their allotted capacity, helping support differentials.
* "I can't explain it … We were expecting weaker," one trader said.
* Light synthetic crude from the oil sands for March delivery strengthened to trade 15 cents over WTI compared with Friday's settle on par with WTI.
* Oil futures edged lower on Monday as worries surrounding the resumption of U.S.-China trade talks overshadowed support from OPEC-led supply restraint.
(Reporting by Devika Krishna Kumar in New York, editing by G Crosse)
Heavy crude discount narrows even as part of Keystone stays shut
Canadian heavy oil differentials narrowed slightly against the West Texas Intermediate (WTI) benchmark on Monday even as a portion of TransCanada's Keystone pipeline remained shut while officials searched for the source of a leak in Missouri:
* Western Canada Select (WCS) heavy blend crude for March delivery in Hardisty, Alberta, settled at $11 a barrel below WTI crude futures slightly narrower than Friday's settle at $11.45 below WTI, according to Net Energy Exchange.
* A portion of TransCanada Corp's Keystone oil pipeline between Steele City, Nebraska and Patoka, Illinois remained shut on Monday and the company said the cause and source of the spill near St Louis, Missouri, had not been determined. A company spokesman said there is no estimated timeline for a restart.
* Traders were caught off guard by the narrowing differential, with some speculating that winners of pipeline space from lotteries were scooping up barrels to meet their allotted capacity, helping support differentials.
* "I can't explain it … We were expecting weaker," one trader said.
* Light synthetic crude from the oil sands for March delivery strengthened to trade 15 cents over WTI compared with Friday's settle on par with WTI.
* Oil futures edged lower on Monday as worries surrounding the resumption of U.S.-China trade talks overshadowed support from OPEC-led supply restraint.
(Reporting by Devika Krishna Kumar in New York, editing by G Crosse)