Heavy discount narrows as production cuts mount
Southern Alberta Oil WellCanadian heavy crude’s discount narrowed versus the U.S. benchmark West Texas Intermediate (WTI) on Monday, surpassing an 11-year low set on Friday. Western Canada Select (WCS) heavy blend crude for June delivery in Hardisty, Alberta, traded at $3.70 per barrel below WTI, according to NE2 Canada Inc, narrower than Friday’s settle of $5.35 under. Prices at that level were the lowest recorded by NE2 in data that goes back to 2009. Cuts to Canadian oil production totalled at least 525,000 barrels per day, with the bulk of reductions in the oil sands, according to company disclosures, Tudor, Pickering, Holt & Co said in a Monday note. Global oil prices LCOc1 rose as countries eased lockdowns and crude supply cuts took hold. O/R Enbridge Inc said on Monday the Canadian pipeline operator had reached a deal with shippers to temporarily store crude oil in North America’s largest oil pipeline network from June 1 and was working with governments to provide additional capacity.