Canada crude - Heavy and synthetic grades extend gains

Fri Jun 7, 2013 5:10pm EDT

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* July WCS last at $14.00/bbl under WTI

* July synthetic last at $4.50/bbl above WTI

CALGARY, Alberta, June 7 (Reuters) - Canadian crude prices strengthened on Friday, with heavy oil supported by expectations of increased refinery demand and light synthetic crude lifted by market talk of a production cut.

Western Canada Select heavy blend for July delivery last traded at $14.00 per barrel below the West Texas Intermediate benchmark, according to Shorcan Energy Brokers.

That compares with a settlement price of $14.75 below the benchmark on Thursday.

Heavy oil has climbed this week on reports Exxon Mobil Corp's 238,600 barrel per day refinery in Joliet, Illinois, could return to service this month.

An upgraded crude distillation unit at BP Plc's 405,000 bpd Whiting, Indiana, refinery is also expected to start by the end of June.

Both U.S. refineries process Canadian heavy crude.

Light synthetic crude from the oil sands for July last traded at a premium of $4.50 per barrel to WTI, up from a settlement price on Thursday of $4.25 above the benchmark.

One market source said prices had been pushed higher this week by a June synthetic crude production cut. A spokeswoman for Canadian Oil Sands Ltd, which owns the largest stake in Syncrude Canada Ltd, declined to comment.

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