Heavy Oil Discount Shrinks Again

* WCS for April delivery in Hardisty, Alberta began trading at $15.90 a barrel under WTI and ended the day at $15.75, according to brokerage CalRock. WCS had traded around $16.15 per barrel below the U.S. benchmark on Monday.

* Canadian prices are supported by expectations that the Trans Mountain pipeline expansion will begin line fill in the coming weeks and seasonally low oil supply, an industry source said.

* The source expects the Canadian heavy oil differential to shrink to single digits in the third quarter.

* Oil producer MEG Energy said on Friday line fill on Canada’s long-delayed Trans Mountain expansion would start in April. The Canadian government-owned pipeline corporation has called for 2.1 million barrels in April and the same amount of oil in May, MEG’s CEO said.

* Global oil futures fell for a second straight session as skepticism around China’s economic growth and declining risk appetite countered a weaker U.S. dollar.

* Cenovus Energy, Canada’s third-largest oil producer, said it plans to boost energy production by 19% during the next five years.

(Reporting by Rod Nickel in Winnipeg, Manitoba; Editing by Shweta Agarwal)