The government of Canada’s main oil-producing province Alberta on Thursday eased oil curtailments for November and December, allowing producers to increase output to 3.80 million barrels per day and 3.81 million barrels per day respectively.
Alberta has had oil curtailments in place since the start of the year to ease congestion on export pipelines and help support prices. The policy was announced by the province’s previous government late in 2018 after a glut of crude built up in storage, sending the discount on heavy Canadian crude versus U.S. benchmark oil to record levels of more than $50 a barrel.
Canadian heavy oil is currently trading at a discount of $12.50 a barrel below U.S. crude, according to Net Energy Exchange.
Curtailments have eased steadily throughout the year, with the amount companies are allowed to produce increasing from 3.56 million bpd in January to 3.79 million bpd in October.
The first 20,000 bpd a company produces are exempt from curtailments, meaning only 15 out of more than 300 Alberta oil producers are affected.