Canadian heavy crude’s discount narrowed versus the U.S. benchmark West Texas Intermediate (WTI) crude on Thursday, as inventories declined and maintenance season approached for oil sands operations.
Western Canada Select (WCS) heavy blend crude for April delivery in Hardisty, Alberta, was trading at $14.05 per barrel below WTI, according to NE2 Canada Inc, narrower than Wednesday’s settle of $14.60 under.
On Tuesday, the WCS-WTI differential was as narrow as $13, the smallest since Oct. 2.
Reduced inventories and the approach of upstream turnaround season have kept differentials tight, along with weakness in WTI prices, a Calgary energy source said.
Western Canadian oil inventories totaled 31.7 million barrels on Feb. 28, down from 32.5 million on Feb. 7, data provider Genscape said.
Canadian Natural Resources said a 55-day turnaround at the Scotford upgrader will start in April, and it will run at restricted rates.
Canadian Natural, Canada’s biggest oil producer, also said it wants the province of Alberta to consider eliminating its restrictions on crude production during summer months.
Global oil prices fell as the coronavirus epidemic showed no signs of slowing, feeding worries about the global economy.
Light synthetic crude from the oil sands was trading at $3.10 over WTI, wider than Wednesday’s settle of $2.10 over.
Canada’s Supreme Court said it would not hear five separate appeals of a lower court’s decision related to the Trans Mountain oil pipeline.