Heavy oil continues widening ahead of long weekend

The discount on benchmark heavy Canadian crude versus West Texas Intermediate widened on Friday ahead of a long weekend.

Canadian heavy crude has been under pressure since spring due to a release of oil from the U.S. Strategic Petroleum Reserve.

BP Plc’s Whiting, Indiana refinery, a major buyer of Canadian heavy crude, was restarting production units this week after a fire, and its production problems have also weighed on Canadian prices, two traders said.

Western Canada Select (WCS) heavy blend crude for October delivery in Hardisty, Alberta, was trading around $20.50 a barrel below WTI, slightly wider than the previous day, according to NE2.

Liquidity was thin ahead of a long weekend in Canada and the United States.

Canadian crude physical markets will not trade on Monday for Canada’s Labour Day holiday.

Global oil prices climbed on expectations that OPEC+ will discuss output cuts at a meeting on Sept. 5, though concern over China’s COVID-19 curbs and weakness in the global economy loomed over the market.