The discount on Western Canada Select (WCS) heavy crude versus the North American benchmark West Texas Intermediate (WTI) deepened on Tuesday:
* WCS for March delivery in Hardisty, Alberta, settled at $19.45 a barrel under WTI, according to brokerage CalRock, having closed at $18.85 per barrel below the U.S. benchmark on Monday.
* Canadian heavy crude prices are widening due to the ongoing shutdown of BP’s 435,000 barrel-per-day Whiting refinery, which is a major buyer of WCS, and further delays to the Trans Mountain pipeline expansion project (TMX).
* TMX will nearly treble the flow of crude from Alberta to Canada’s Pacific Coast to 890,000 bpd and producers have been boosting output in anticipation of new export capacity. But the troubled project hit fresh delays on its final leg of construction last week.
* On Tuesday Trans Mountain said it continues to “assess options” and is working towards an in-service date in the second quarter of 2024.
* Global oil prices initially climbed over $1 a barrel after the U.S. Energy Department said crude oil production would grow less than forecast but then gave up some of the gains on talk of a possible lengthy ceasefire in the Gaza War.
(Reporting by Nia Williams in British Columbia; editing by Deepa Babington)