Canadian heavy crude’s differential to West Texas Intermediate (WTI) narrowed on Wednesday.
Western Canada Select heavy blend crude for December delivery in Hardisty, Alberta, last traded at $20 per barrel below the WTI benchmark, according to NE2 Canada Inc, narrowing from Tuesday’s settle of $20.15 per barrel below the benchmark.
The slight tightening failed to offset a steady widening trend to the Canadian heavy crude discount so far this month. Industry players said WCS has been weighed down by strong oil sands production and lackluster demand on the U.S. Gulf Coast, the world’s largest heavy crude refining center.
The outright price of WCS is strong despite the wider differential, trading at more than $61 a barrel due to a rally in global crude prices this year.
Light synthetic crude from the oil sands for December delivery last traded at $3.30 per barrel below the U.S. crude benchmark, flat from the previous day’s settle.
Global oil prices slumped, hit by a surge in the dollar after U.S. President Joe Biden said his administration was looking for ways to reduce energy costs amid a broader surge in inflation.