The discount on Western Canada Select crude oil to North American benchmark West Texas Intermediate futures widened on Thursday.
WCS for May delivery in Hardisty, Alberta, settled at $17 a barrel, below the U.S. benchmark WTI, according to brokerage CalRock, compared to $16.60 on Wednesday.
* That marks the steepest differential for heavy Canadian crude since the start of the U.S. war on Iran.
* The WCS differential has been volatile since the start of conflict and the effective closure of the Strait of Hormuz, which has sharply reduced crude exports from the region and left energy importers scrambling for alternative supplies.
* Historically, the WCS differential tends to widen when oil prices are higher overall and narrow in lower-price environments, as greater demand for oil means more competition for space on Canada’s crude export pipelines.
* Oil prices rose on Thursday on skepticism that forthcoming peace talks between the U.S. and Iran would be able to resolve disruptions to Middle Eastern energy supplies caused by the ongoing war.
(Reporting by Amanda Stephenson in Calgary; Editing by Maju Samuel)