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Heavy oil discount deepens

January 4, 20244:37 PM Reuters0 Comments

The discount on Western Canada Select (WCS) heavy crude versus the North American benchmark West Texas Intermediate (WTI) deepened on Thursday:

* The discount on WCS for February delivery in Hardisty, Alberta, opened at $18.15 a barrel under WTI before weakening to a low of $19 under, according to brokerage CalRock. It traded on Wednesday between $17.50 and $18.40 per barrel under WTI.

* Soft refinery demand during turnarounds and strong Canadian crude production added to negative price sentiment, a trader said.

* Concerns about the timing of the Trans Mountain pipeline expansion entering service also weighed on the market.

* Trans Mountain plans to begin line fill of its expanded pipeline in March or May depending on the diameter of pipe it uses and assuming no new problems, the Canadian government-owned company said Wednesday.

* Trans Mountain has asked the Canada Energy Regulator for a decision on its request for a construction change by Jan. 9 but the regulator said it was not bound by that deadline.

* Global benchmark oil prices fell as massive weekly gasoline and distillate stock builds overshadowed a larger-than-expected crude stock draw.

(Reporting by Rod Nickel in Winnipeg, Manitoba; Editing by Subhranshu Sahu)

Trans Mountain Pipeline

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