Canada crude - Heavy and synthetic grades weaken in thin trade
* Jan WCS trades at $28.90/bbl below WTI
* Jan synthetic trades at $7.25/bbl below WTI
CALGARY, Alberta Dec 13 (Reuters) - Canadian cash crude prices weakened slightly in thin trading on Friday as some traders decided a recent rally had gone too far.
Western Canada Select heavy blend for January delivery last traded at $28.90 per barrel below the West Texas Intermediate benchmark, according to Shorcan Energy brokers.
That compares with a settlement price on Thursday of $27.50 per barrel below the benchmark.
WCS rallied strongly during the week, climbing from $30.75 per barrel below the benchmark last Friday to reach a three-month high of $26.75 per barrel below WTI on Wednesday, as market players bet on cold weather causing production outages in the oil sands.
Traders in Calgary said Friday's pullback was simply the result of market participants deciding those gains were overdone and "tidying up" positions ahead of the last day of the December trade cycle on Monday.
The overall trend has been one of narrowing differentials however, with Canadian grades benefiting in recent weeks from an uptick in demand from refineries in the U.S. Mid West, said David Bouckhout, senior commodity strategist at TD Securities.
"They're reinforced by demand from PADD 2 refineries for heavy oil as they continue to increase their production and take advantage of these profitable refining margins," he said. Continued...