The discount on Western Canada Select (WCS) crude oil to North American benchmark West Texas Intermediate futures widened again on Thursday, as soaring global freight prices continue to put pressure on Canadian barrels re-exported off the US Gulf Coast.
WCS for November delivery in Hardisty, Alberta, settled at $25.20 a barrel below the US benchmark WTI, according to brokerage CalRock, compared with $25.15 on Wednesday. The discount remains more than $10 wider than it was at this point in last month’s trading cycle and remains wider than it has been since 2023.
* The cost to transport oil on tankers globally has hit record highs in recent weeks following attacks on ships since the US-Iran war began in late February
* That has made re-exporting Canadian heavy crude barrels from the US Gulf Coast cost-prohibitive, traders said, adding Canada’s main crude export pipelines are essentially full, leaving few options to absorb strong production coming out of the country’s oil sands region
* Oil prices settled 4% higher on Thursday on revived concerns about the ongoing war in the Middle East and growing supply disruptions due to a hurricane approaching the US Gulf Coast.
(Reporting by Amanda Stephenson in Calgary; Editing by Diti Pujara)