The discount on Canadian heavy crude versus the West Texas Intermediate benchmark narrowed for a second session on Tuesday.
Western Canada Select heavy blend crude for July delivery in Hardisty, Alberta, last traded at $18.80 a barrel below WTI, according to NE2 Group, narrowing from the previous settlement of $19.85 a barrel under the benchmark.
Canadian heavy barrels are recouping some of the weakness seen over the last month, after the U.S. government’s Strategic Petroleum Reserve release flooded the Gulf Coast market with sour crude, pushing prices lower.
Light synthetic crude from the oil sands for July delivery settled at $8.10 a barrel over WTI, supported by oil sands maintenance. Analysts at RBC Capital Markets said in a note to clients Suncor is planning an annual coker turnaround at the Syncrude project in the July-August timeframe.
Maintenance at Suncor’s Firebag project is expected to be finished in July, RBC added.
Global oil prices gained about 1%, with U.S. crude settling at a 13-week high, on supply concerns and prospects for demand growth in China, which is relaxing lockdowns to control the pandemic.