Canada crude-Heavy falls on line rationing, refinery outages

Tue Nov 5, 2013 5:36pm EST
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* Dec WCS trades at $41.25/bbl below WTI

* Dec synthetic trades at $15.25/bbl below WTI

CALGARY, Alberta Nov 5 (Reuters) - Canadian heavy crude prices extended losses on Tuesday to hit fresh 10-month lows, as congestion on export pipelines and unplanned refinery outages weighed on the market.

Western Canada Select heavy blend for December delivery last traded at $41.25 per barrel below the West Texas Intermediate benchmark, according to Shorcan Energy brokers - the widest differential since January - compared with a settlement price on Monday of $40.90 per barrel below the benchmark.

Increased pipeline apportionment on the Enbridge Inc network means producers are unable to ship as much crude as they want to market and oil is getting bottlenecked in Alberta, driving prices downward.

Reduced demand from Citgo Petroleum Corp's 174,500 bpd Lemont, Illinois, refinery after a fire in October, added to pressure on heavy crude prices. Trade sources said there was a separate fire over the weekend at the 130,000 bpd Co-op refinery in Regina, Saskatchewan.

But a Calgary crude trader said the impact of the Co-op refinery fire on December differentials was limited, given the already steep discount to WTI.

"It was already a mess. This just adds onto the pile," he said.

Light synthetic crude from the oil sands for December delivery edged slightly higher to trade at $15.25 per barrel below WTI. It held within sight of Monday's settlement of $15.50 per barrel below the benchmark, the widest differential since March 2012.