The discount on Western Canada Select (WCS) to the North American benchmark West Texas Intermediate futures (WTI) widened on Tuesday.
WCS for June delivery in Hardisty, Alberta, settled at $9.15 a barrel under the U.S. benchmark WTI, according to brokerage CalRock, after having settled at $9.10 under the U.S. benchmark on Monday.
* Canadian heavy crude has been trading at a tight discount in recent months in part due to the opening of the Trans Mountain pipeline expansion one year ago, which boosted the country’s oil export capacity.
* Trans Mountain still has excess capacity available, which means the WCS discount is sustainable at a tight discount for months or even the next several years, barring a black swan event, said Enverus Intelligence analyst Michael Berger.
* Canadian crude has also benefited from U.S. sanctions on Venezuela and other countries, which is boosting demand for non-sanctioned heavy crude producers.
* Globally, crude oil futures climbed more than $1.60 a barrel on Tuesday, lifted by a temporary cut in U.S.-China tariffs and a better-than-expected inflation report.
(Reporting by Amanda Stephenson in Calgary; Editing by Leroy Leo)