Canadian light synthetic crude climbed on Wednesday, extending strong gains so far this week, while the differential on heavy crude to the West Texas Intermediate (WTI) benchmark widened slightly.
The outright price of both heavy and synthetic Canadian crude, which are both priced at a differential to WTI, dropped as the U.S. benchmark recorded its sharpest daily decline in two years after the United Arab Emirates said it supported increasing crude supply.
Oil markets globally have been roiled by supply disruptions following Russia’s invasion of Ukraine.
Light synthetic crude from the oil sands for April delivery in Hardisty, Alberta, settled at $6.85 a barrel over WTI, according to NE2 Canada Inc, up from Tuesday’s settle of $6.50 a barrel over the benchmark.
Canada’s oil sands upgrader maintenance season is looming, which will reduce a significant amount of crude supply from a market that is already short of light barrels.
Shell confirmed it had issued a force majeure at its Scotford, Alberta, upgrader.
Western Canada Select heavy blend crude for April delivery in Hardisty, Alberta, widened slightly to $12.90 per barrel below WTI, having settled on Tuesday at $12.70 a barrel below the U.S. benchmark.