July 13, 2017 / 11:35 PM / in 3 years

Synthetic premium dips but still holds near two-week high

CALGARY, Alberta (Reuters) - The premium of Canadian light synthetic crude eased slightly on Thursday, but held near a two-week high on concerns about reduced supply from the Syncrude oil sands project in northern Alberta.

Syncrude Canada, which is majority-owned by Suncor Energy (SU.TO), has reduced its July production forecast for the second time in a week, sources said on Wednesday.

It cut its July forecast by around 3.2 million barrels to 5.2 million barrels, the sources said.

The 350,000 barrel per day plant has been running below capacity since a fire in mid-March forced Syncrude to cut production and bring forward planned maintenance.

On Monday a small fire broke out in a sulfur emissions reduction unit at the facility. It is not clear if the latest cuts are a result of that fire.

Light synthetic crude for August delivery last traded at $1.20 per barrel over the West Texas Intermediate benchmark, according to Shorcan Energy brokers. That was done 20 cents from Wednesday’s settle at $1.40 per barrel over WTI, which has the highest premium since late June.

Synthetic crude for July delivery last traded at $3.25 per barrel over WTI, having shot up to $3.50 a barrel over benchmark crude the previous day.

Western Canada Select heavy blend crude for August delivery last traded at $9.25 per barrel below WTI, unchanged from Wednesday’s settle.

Editing by Diane Craft

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