Heavy Oil Discount Narrows Slightly

WCS for May delivery in Hardisty, Alberta, traded at $11.75 a barrel below WTI, according to brokerage CalRock, after closing at $11.90 a barrel below the benchmark on Thursday.

Canadian heavy crude has traded at a discount of less than $12 a barrel to WTI since the start of this month’s trade cycle on Wednesday, when the 590,000 barrel per day Trans Mountain pipeline expansion (TMX) also started commercial operations.

Oil sands producers, including Canadian Natural Resources Ltd and Cenovus Energy this week said TMX will benefit the entire industry.

Many analysts expect the pipeline will help tighten heavy crude differentials to less than $10 a barrel below WTI by removing export pipeline bottlenecks and forcing U.S. refiners to compete with global buyers for Canadian barrels.

Global oil prices settled lower and posted their steepest weekly loss in three months as investors weighed weak U.S. jobs data and the possible timing of a Federal Reserve interest rate cut.