Canadian heavy crude’s differential to West Texas Intermediate (WTI) widened further on Friday, trading at levels last seen in April 2020:
Western Canada Select heavy blend crude for December delivery in Hardisty, Alberta, last traded at $20.00 per barrel below the WTI benchmark, according to NE2 Canada Inc, widening from a settlement of $19.65 per barrel below the benchmark on Thursday.
Industry sources said a combination of factors including strong Canadian oil sands production and weak demand for heavy barrels on the U.S. Gulf Coast were weighing on WCS.
Enbridge Inc said its Line 3 oil pipeline, which started shipping more crude in October after a replacement project was completed, is operating at full capacity. A spokeswoman said there was some scheduled maintenance taking place, but it was not having a material impact on the pipeline.
Despite the deeper discount, the outright price of WCS remains relatively strong at more than $61 a barrel.
Global oil prices settled higher, fuelled by renewed supply concerns after OPEC+ producers rebuffed a U.S. call to accelerate output increases even as demand nears pre-pandemic levels.