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Heavy discount narrows as trade cycle finishes

October 16, 2019 4:56 PM
Reuters

The discount on Canadian heavy crude narrowed versus U.S. benchmark West Texas Intermediate (WTI) crude on Wednesday as the monthly trade cycle wrapped up.

Western Canada Select (WCS) heavy blend crude for November delivery in Hardisty, Alberta, traded at $16.15 per barrel below WTI, according to Net Energy Exchange. On Tuesday November WCS settled at $16.35 a barrel below WTI.

Light synthetic crude from the oil sands strengthened to trade at $1.60 per barrel over WTI, having settled at $1 per barrel over the benchmark the previous day.

Wednesday is the last day of the monthly Canadian crude trading window, which runs from the first of each month until the day before pipelines nominations are due on the Enbridge Inc system.

The 135,000 barrel-per-day Co-op Refinery Complex in Regina, Saskatchewan, is preparing for possible strike action after the local workers union declared an impasse in negotiations over pensions.

Energy infrastructure company Rangeland Midstream Canada Ltd said it will start construction of its 80,000 barrel-per-day Marten Hills Pipeline System, a regional gathering system, in north central Alberta later this month.

The government of Alberta, Canada’s main crude-producing province, has set crude production curtailments for November and December at 3.80 million barrels per day and 3.81 million barrels per day, respectively. Alberta introduced curtailment at the start of 2019 to tackle pipeline congestion and support crude prices.

U.S. West Texas Intermediate crude rose 55 cents to settle at $53.36 a barrel, gaining support on signs that OPEC and allied producers will continue to curb supplies in December.

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