Total U.S. crude oil imports continue to decline, driven by a sharp drop in supplies from Canada. Canadian imports fell by 540 Mb/d to 3.13 MMb/d, the lowest volume recorded since the week ending August 26, 2022. This decline coincided with a narrowing basis between Western Canadian Select (WCS) and WTI Cushing, which tightened from an average of -$13.69/bbl to -$11.31/bbl last week. Given ongoing geopolitical uncertainty, it remains to be seen whether this signals the start of a sustained trend or merely a temporary fluctuation.
Featured Articles
- Blog
Same Ol' Situation - Why Western Canada's Heavy Oil Discount Has Widened Again
The price discount for Western Canada’s benchmark heavy crude oil has seen yet another widening in the past few months. Increased pipeline access to the U.S. was believed to be the key to solving this problem in the long term, but more recent fundamental developments surrounding pipeline egress, refinery demand and increasing heavy oil supplies demonstrate that larger discounts can — and do — still happen. This problem could persist for several more months until a better balance is achieved in downstream markets. In today’s RBN blog, we discuss the latest drivers of the wider price discounts for Western Canada’s heavy oil.
- Blog
Low Budget - Western Canadian Select Crude Topples to 10-Year Low
The price of northeastern Alberta’s key crude oil benchmark, Western Canadian Select (WCS), has been dropping like a rock. Last week, the heavy, sour blend of crude fell to a $45/bbl discount against U.S. benchmark West Texas Intermediate (WTI) — the biggest differential in at least 10 years. With an unplanned summertime outage at a Syncrude upgrader now over, Alberta production rising and pipeline takeaway capacity static — at least for now — the value of Canada’s crude may have even bleaker days ahead, despite a recent global rally in oil prices. Today, we explain why Western Canada’s oil producers are facing the prospect of mile-wide spreads for months to come.
- Blog
Tighten Up - The Stars Align and the Western Canadian Heavy/WTI Differential Narrows
Any number of things can impact the price of specific types of crude oil at various locations — supply interruptions, takeaway constraints and refinery outages, to name just a few. Every so often, the stars align and just about all those factors narrow the differential between, say, Western Canadian Select (WCS) and West Texas Intermediate (WTI) at the U.S. Gulf Coast to near-record levels. Well, that’s happening now, for the first time in five years. In today’s RBN blog, we discuss the shockingly small WCS/WTI differential and what’s driving it.
