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(Reuters) – The discount on Western Canada Select to North American benchmark West Texas Intermediate futures narrowed on Monday.
WCS for November delivery in Hardisty, Alberta, settled at $10.75 a barrel under the U.S. benchmark WTI, according to brokerage CalRock, compared to Friday’s close of $11.
- Canadian pipeline operator Enbridge’s Mainline system — which transports oil from Alberta to various markets in Canada and the U.S. — is not at apportionment in October. Apportionment is an industry term for the rationing that occurs when demand for pipeline space exceeds capacity.
- The increase in seasonal capacity this month on the Mainline is due to less planned maintenance on the system, an Enbridge spokesperson said.
- Analysts say the WCS discount will likely continue to trade close to its current range, or even tighten this autumn. Midwest refining runs are at record highs for this time of year, helping to keep the WCS discount seasonally narrow.
- Oil prices gained about 1% on Monday after the OPEC+ production increase planned for November was more modest than expected, tempering some concerns about supply additions, though a soft outlook for demand is likely to cap near-term gains.
Reporting by Amanda Stephenson in Calgary; Editing by Shailesh Kuber
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