The discount on Western Canada Select crude oil to North American benchmark West Texas Intermediate futures narrowed again on Tuesday.
WCS for July delivery in Hardisty, Alberta, settled at $11.80 a barrel below the U.S. benchmark WTI, according to brokerage CalRock, compared with $12 a barrel on Monday.
* The WCS differential, which has been volatile with global crude price swings since the start of the U.S.-Iran conflict, has compressed as WTI has come down from recent months’ highs, said Al Salazar, head of research at Enverus.
* U.S. refinery demand is strong, as evidenced by refineries deferring maintenance and running with very high utilization rates.
* The narrowing differential so far this month is also due to seasonal considerations, as spring and summer road-paving contributes to higher demand for heavy Canadian crude for use in asphalt production.
* Oil prices fell about 3% to a seven-week low on Tuesday after Iran and Israel said they had halted attacks on each other following an appeal from U.S. President Donald Trump.
(Reporting by Amanda Stephenson in Calgary; Editing by Leroy Leo)