Canada crude-Short-covering lifts heavy grades
* February WCS quoted at $39/bbl under WTI * February synthetic quoted at $0.35/bbl over WTI * Fire hits sweet crude unit at Wood River refinery-trader CALGARY, Alberta, Jan 14 (Reuters) - Canadian heavy crude prices rose on Monday on some short-covering and expectations that a weekend upset at a major U.S. Midwest refinery would have a bigger impact on lighter grades. Western Canada Select heavy blend for February delivery last sold for $39 a barrel under benchmark West Texas Intermediate, a $1.75 narrower discount than the Friday settlement, according to Shorcan Energy Brokers. Phillips 66 said on Sunday a crude distillation unit at the 356,000 barrel a day Wood River refinery was shut temporarily following a fire. A trader pointed out, however, that the affected unit at the plant, a major heavy crude processor that co-owned by Cenovus Energy Inc, processes light, sweet crude. Another marketer said gains were likely the result of short covering after two weeks of steadily deepening discounts for Canadian heavy, which is being hit by tight export pipeline capacity. The drop intensified last week after Enbridge Inc imposed mid-month apportionment on three of its Canada-United States pipelines. When pipelines set apportionment, they reduce the actual volumes that shippers can move from amounts nominated. Because less crude can move through the pipeline, backlogs occur. The 796,000 barrel-per-day Line 4, between Edmonton, Alberta, and Superior, Wisconsin, and 450,000 bpd Line 67, between Hardisty, Alberta, and Superior, are apportioned at 10 percent. Line 6A, which can carry 609,000 bpd between Superior and Griffith, Indiana, is apportioned at 16 percent. Light synthetic crude, meanwhile, also strengthened on Monday. February synthetic last sold for 35 cents a barrel above WTI, compared with 20 cents under WTI on Friday.
- Malaysia Airlines plane missing at sea off Vietnam, presumed crashed |
- CORRECTED-UPDATE 4-Malaysia Airlines plane crashes in South China Sea with 239 people aboard - report
- China draws 'red line' on North Korea, says won't allow war on peninsula
- Warning shots fired to turn monitors back from Crimea |
- Malaysian plane crashed off Vietnam coast: state media