CALGARY, Alberta (Reuters) - Canadian heavy crude differentials hit their widest level in more than five months on Thursday as U.S. Gulf Coast refineries shut down in the wake of Hurricane Harvey.
Harvey, which brought record flooding to the U.S. oil heartland of Texas over the weekend, killed at least 35 people and paralyzed at least 4.4 million barrels per day (bpd) of refining capacity, according to company reports and Reuters estimates.
Canada exports around 412,000 bpd of mainly heavy crude to the Gulf Coast region, around 14 percent of its total exports to the United States, and prices sagged as traders anticipated barrels backing up in Alberta.
Western Canada Select heavy blend crude for October delivery last traded at $12.15 per barrel below the West Texas Intermediate benchmark, according to Shorcan Energy brokers.
On Wednesday WCS settled at $11.20 per barrel below the benchmark.
Traders in Calgary have said it was difficult to know how long the impact of Harvey, which became a tropical storm after making landfall, would last, with much depending on the speed at which Gulf Coast refineries could return to full production and how fast crude storage tanks fill up.
Light synthetic crude prices fell to reach $1.30 per barrel over WTI, having settled at $1.65 cents per barrel over the benchmark on Wednesday.
Reporting by Ethan Lou; editing by Grant McCool