Canadian heavy crude’s discount widened versus U.S. benchmark West Texas Intermediate (WTI) oil on Monday, the last day of the monthly trading cycle.
Western Canada Select (WCS) heavy blend crude for April delivery in Hardisty, Alberta, traded at $13.60 per barrel below WTI, according to NE2 Canada Inc, wider than Friday’s settle of $12 under.
The cycle ends the day before Enbridge Inc’s due date for notices of shipments on its Mainline system. Apportionment may be reduced this month with some producers curbing production due to low prices, a Calgary trader said.
The heavy differential at Hardisty, Alberta widened to reflect a wider gap between WCS at Houston versus WTI, a Calgary industry source said. The effect of reduced Saudi official selling prices and new marine emissions requirements called IMO 2020 were seen widening the WCS-WTI differential at Houston.
Reduced rail shipping due to cutbacks by Canada’s Cenovus Energy also pushed the WCS-WTI spread wider.
Husky Energy on Thursday was the latest large Canadian oil producer to cut 2020 spending and production, following Cenovus and MEG Energy .
Canada’s Royal Bank said on Monday it had revised its 2020 outlook for the WTI-WCS spread to $15.65 from $20, mainly due to tighter Maya-WCS spreads.
Light synthetic crude from the oil sands was trading at $3.90 below WTI after Friday’s settle of $3.30 under.
Global oil prices fell below $30 a barrel as the worldwide coronavirus outbreak worsened over the weekend, exacerbating fears that government lockdowns to contain the spread of the disease would spark a global recession.