Heavy discount widens slightly, outages factored in

Canadian heavy crude’s discount versus West Texas Intermediate (WTI) widened slightly on Wednesday from levels that were already narrow, with recent production outages factored into prices.Western Canada Select (WCS) heavy blend crude for October delivery in Hardisty, Alberta, traded at $7.50 per barrel below WTI, according to NE2 Canada Inc. It settled on Tuesday at $7.45 under.

A Calgary industry source said the heavy differential is already tight, and Imperial Oil Ltd may restart its 220,000-barrel-per-day (bpd) Kearl oil sands site in Canada this month, after shutting production last week due to an outage of part of the Polaris pipeline in Alberta.

An Imperial spokesman said it had nothing new to report about Kearl.

Suncor said on Sunday it has reduced its 2020 production guidance by 9% after the August fire at its Base Mine.

Light synthetic oil from the oil sands for October delivery traded at $1.65 below WTI, narrower than Tuesday’s settle of $1.85.

Global oil prices clawed back some of the losses they sustained in the previous session, but a rebound in COVID-19 cases in some countries undermined hopes for a steady recovery in global demand.