Canadian producers are moving to restore much of the production that they shut in as prices improve.
Supply looks to near recent highs by year end and is driving differentials wider, a trader said, despite ample space in Canadian storage and slack pipeline space.
Light synthetic crude from the oil sands for September delivery traded at $1.50 a barrel under WTI, wider than the previous day’s settle of 55 cents under.
Benchmark oil prices climbed to a five-month high after a large decline in U.S. crude inventories.
Western Canada’s takeaway capacity looks balanced with oil supply through 2020, with a modest crude surplus seen developing in early 2021, Eight Capital said in a note.
Canadian crude oil exports to the United States rose 240,000 barrels per day to 2.99 million barrels per day in June, Statistics Canada said.
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