July 4, 2017 / 10:46 PM / 5 months ago

Heavy grades hold steady on strong demand

CALGARY, Alberta (Reuters) - Canadian heavy crude differentials were steady on Tuesday, the first day of the new monthly trading window, as strong demand kept the discount close to its tightest level in two years.

Western Canada Select heavy blend crude for August delivery last traded at $9.70 per barrel below the West Texas Intermediate benchmark, according to Shorcan Energy brokers.

That was unchanged from Friday’s settlement and within sight of the two-year high of $8.60 per barrel below WTI hit in mid-April.

Traders in Calgary said strong demand for Canadian crude in the U.S. Gulf Coast was helping prop up prices in Alberta. Falling Mexican and Venezuelan crude production and cuts from producer group OPEC, aimed at tackling a global crude glut, have pinched Gulf Coast supply and increased the pull on Canadian heavy sour barrels.

One trader also said lower-than-expected apportionment on Enbridge pipelines in July meant some people in the market were short heavy crude and looking for more barrels to meet their nominated volumes.

Light synthetic crude from the oil sands for August delivery last traded at 55 cents per barrel over WTI, having settled at 35 cents over the benchmark on Friday.

Editing by Peter Cooney

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