The discount of Western Canada Select (WCS) heavy crude to the North American benchmark West Texas Intermediate futures (WTI) widened on Wednesday.
WCS for May delivery in Hardisty, Alberta, settled at $10.30 a barrel under WTI, according to brokerage CalRock, after having settled at $10.10 under the U.S. benchmark on Tuesday.
* The Keystone oil pipeline from Canada to the U.S. was shut on Tuesday after an oil spill near Fort Ransom, North Dakota, its operator South Bow and the state’s Department of Environmental Quality said. * The WCS discount also reflects some tightness following U.S. sanctions on heavy crude-producing countries such as Venezuela, as well as lower heavy crude exports from Mexico.
* But the differential on Canadian heavy crude also tends to widen when global oil prices are higher overall and narrow in lower price environments, in part because lower prices mean less competition for pipeline space for Canadian producers. * Oil prices climbed more than 4% on Wednesday, bouncing back from four-year lows earlier in the session, after U.S. President Donald Trump said he would further increase tariffs on China but pause the tariffs he announced last week for most other countries.
(Reporting by Georgina McCartney in Houston; Editing by Maju Samuel)