The discount on Canadian heavy crude versus the West Texas Intermediate (WTI) benchmark widened on Monday.
Western Canada Select (WCS) heavy blend for May delivery in Hardisty, Alberta, settled at $12.20 a barrel below WTI, according to NE2 Canada Inc, widening from Friday’s $11.95 a barrel below the benchmark.
Light synthetic crude from the oil sands for May delivery weakened to $5.85 a barrel over WTI, down 10 cents from Friday.
Both grades remained relatively strong and Canadian crude prices are expected to be supported throughout the second quarter as annual maintenance work in the oil sands shutters roughly 5% of Canada’s crude output.
Oil sands crude supply is being impacted by seasonal maintenance on projects in northern Alberta. Synthetic supply is expected to be especially tight in the second quarter, contributing to stronger differentials.
Global benchmark oil prices jumped over 3%, with investors worried about tighter supply as mounting civilian deaths in Ukraine increased pressure on European countries to impose sanctions on Russia’s energy sector.