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(Reuters) – The discount on Western Canada Select to the North American benchmark West Texas Intermediate futures widened on Thursday.
WCS for August delivery in Hardisty, Alberta, settled at $10.30 a barrel under the U.S. benchmark WTI, according to brokerage CalRock, compared with $10.05 a barrel on Wednesday.
- Summer and the return of road construction season are a seasonally strong time of year for Canadian heavy crude, which is used by U.S. refiners to produce asphalt.
- The WCS discount has widened slightly since last month, when concerns about wildfires in Canada’s oil-producing regions led to a temporary tightening. But pricing for Canadian crude remains historically strong, in part due to the opening of the Trans Mountain pipeline expansion, which boosted the country’s oil export capacity to Asian markets.
- RBN Energy analyst Martin King said barring anything unexpected, WCS should continue to trade within a tight band this summer. “Any widening we are seeing now is likely just due to the market looking ahead to more production coming on in August and September, because by all indications (Canadian) producers are firing away on all cylinders right now,” King said.
- Global oil prices fell slightly on Thursday as investors worried that U.S. tariffs could slow energy demand ahead of an expected supply boost by major crude producers.
Reporting by Amanda Stephenson in Calgary; Editing by Marguerita Choy
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