Discount on Western Canada Select Heavy Crude Widens

WCS for June delivery in Hardisty, Alberta, settled at $9.25 a barrel under the U.S. benchmark WTI, according to brokerage CalRock, after having settled at $9.15 under the U.S. benchmark on Wednesday.

* Canadian heavy crude has been trading at a tight discount in recent months in part due to the opening of the Trans Mountain pipeline expansion one year ago, which boosted the country’s oil export capacity. On average, WCS-WTI differentials have narrowed by $4, or 23%, over the past year, according to RBC Capital Markets.

* Canadian crude has also benefited from U.S. sanctions on Venezuela and other countries, which is boosting demand for non-sanctioned heavy crude producers.

* Oil prices settled lower on Thursday on expectations for a U.S.-Iran nuclear deal that could result in sanctions being eased and more barrels released onto the global market.

(Reporting by Amanda Stephenson in Calgary; Editing by Mohammed Safi Shamsi)