Heavy crude differential widens


crude oil rail cars
Railcars holding crude oil

Canadian heavy crude’s discount to West Texas Intermediate (WTI) widened on Friday.

Western Canada Select heavy blend crude for November delivery in Hardisty, Alberta, last traded at $13.10 per barrel below the WTI benchmark, according to NE2 Canada Inc, widening 40 cents from the previous day’s settle.

The discount on heavy crude had been edging wider since the start of the monthly trade cycle last Friday, after hitting its narrowest level in five months in late September in anticipation of Enbridge Inc bringing its Line 3 replacement project into service. Linefill on the Line 3 pipeline started on Oct. 1.

One industry source said there was no clear reason for the widening differential, but the recent strong rally in U.S crude prices to more than $80 a barrel could account for some of it. A deeper discount on Canadian barrels offsets some of the rise in the benchmark crude price.

Light synthetic crude from the oil sands for November delivery last settled at $1.25 a barrel below U.S. benchmark crude, widening from Thursday’s settle of $1.00 a barrel below benchmark prices.

Global oil prices rose, up more than 4% on the week as a global energy crunch boosted prices to their highest since 2014 and prompted China to demand increased coal production.


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