Western Canada Select (WCS) heavy crude’s discount to the benchmark West Texas Intermediate (WTI) narrowed on Monday.
WCS for June delivery in Hardisty, Alberta, traded $12.40 to $12.80 a barrel under the benchmark, according to brokerage CalRock. On Friday, the Canadian heavy benchmark had ended $12.80 a barrel below WTI.
Benchmark Canadian heavy crude prices have tightened to multi-month highs on concerns about wildfires in Alberta that forced some producers to shutter production.
“Definitely production is still impacted and it could get worse,” an industry source said.
Limited refinery turnarounds are expected, keeping crude supplies tight, the source added.
Prime Minister Justin Trudeau visited Alberta as raging wildfires prompted mass evacuations in Canada’s main oil-producing province, where meteorologists expect virtually no rain for about 10 days.
Global oil prices rose a dollar a barrel on the prospect of tightening supplies in Canada and elsewhere, although recession fears kept the market pressured.