The premium on synthetic Canadian crude from the oil sands climbed on Wednesday, regaining some ground after losses so far this month.
Light synthetic crude from the oil sands for September delivery last traded at $5.90 a barrel over the West Texas Intermediate benchmark, according to NE2 Group, rising from Tuesday’s settlement of $4.50 a barrel over WTI.
Synthetic prices had been easing in recent weeks after hitting record highs earlier in the summer when maintenance in oil sands upgraders cut supply, and demand for crudes with a strong distillate yield boomed.
Western Canada Select (WCS) heavy blend crude for September delivery in Hardisty, Alberta, last traded at $19.80 a barrel below WTI, according to NE2 Group, unchanged from the previous settlement.
Bart Melek, global head of commodity markets strategy at TD Securities, said Canadian heavy crude was still suffering a hangover from U.S. Strategic Petroleum Reserve’s release of predominantly sour barrels, which flooded the market.
Global oil prices rose, rebounding from losses early in the session, helped by encouraging figures on U.S. gasoline demand and as lower-than-expected U.S. inflation data drove investors into riskier assets.