March 5, 2018 / 10:47 PM / 7 months ago

Heavy crude discount widens on bulging stockpiles

(Reuters) - The Canadian heavy oil discount widened on Monday against the West Texas Intermediate (WTI) benchmark, as bulging crude stockpiles in Alberta weighed on prices and reversed part of a recent narrowing of the price spread.

FILE PHOTO: An oil pump jack pumps oil in a field near Calgary, Alberta, Canada July 21, 2014. REUTERS/Todd Korol/File Photo

The discount had been shrinking modestly in the past week due to additional railway volumes. However, these shipments have not meaningfully reduced the supply overhanging the market, a Calgary-based trader said.

Western Canada Select (WCS) heavy blend crude for April delivery in Hardisty, Alberta, settled at $25.50 a barrel below the WTI benchmark crude price CLc1, according to Shorcan Energy brokers, compared with Friday’s settle of $24.35.

Expanding oil production in Alberta combined with tight transport capacity have caused the supply buildup and a bigger-than-usual WCS discount.

Light synthetic crude from the oil sands for April delivery last traded at $2.35 over WTI, a bigger premium than Friday’s settle of $2.05 over WTI.

Reporting by Rod Nickel in Winnipeg, Manitoba; Editing by Jonathan Oatis

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