The discount on Western Canada Select to North American benchmark West Texas Intermediate futures widened on Thursday.
WCS for November delivery in Hardisty, Alberta, settled at $10.60 a barrel under the U.S. benchmark WTI, according to brokerage CalRock, compared to Wednesday’s close of $10.50.
* The WCS discount has been tight this month, contrary to the typical seasonal pattern that usually sees the discount widen after the end of the summer driving season.
* October’s narrowing is being driven nearly entirely by unexpected demand strength from U.S. refineries, said Enverus analyst Al Salazar. An EIA report on Wednesday showed U.S. refinery crude runs rose by 129,000 bpd last week, while U.S. gasoline and distillate inventories fell due to strong fuel demand.
* Canadian crude oil production continues to rise. The oil-producing province of Alberta’s crude output was 4.2 million barrels per day in August, according to the Alberta Energy Regulator, the highest on record for that month.
* Oil prices settled lower on Thursday after Israel and the Palestinian militant group Hamas signed an agreement to cease fire in Gaza.
(Reporting by Amanda Stephenson in Calgary; Editing by Sahal Muhammed)