Canadian Heavy Crude Oil Is Facing A Crisis

Thomson Reuters Western Canadian Select traded at a discount of $27 a barrel to Western Texas Intermediate. This is Canadian heavy crude oil's largest discount to WTI in six trading sessions. The drop comes after news of additional storage tanks in Alberta and an 11.3 percent crude-by-rail decline in January. Canada’s benchmark heavy crude oil widened its discount to WTI to the largest in six trading sessions on Thursday, as additional storage capacity in Alberta and data about lower crude-by-rail shipments added concerns over the domestic oil glut, as TransCanada’s Keystone Pipeline has yet to return to normal pressure levels following a leak and temporary shutdown last November. On Thursday, Western Canadian Select was trading at a discount of US$27 a barrel to WTI.

 

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