2 Min Read
* November WCS trades at $33.50/bbl below WTI
* November synthetic trades at $12.50/bbl below WTI
CALGARY, Alberta, Oct 3 (Reuters) - Canadian cash crude prices weakened on Thursday, extending losses due to robust production from the oil sands and decreased demand by refineries.
Western Canada Select heavy blend for November delivery last sold for $33.50 per barrel below the West Texas Intermediate benchmark, according to Shorcan Energy brokers.
That compares with a settlement price of $32.85 per barrel below the benchmark on Wednesday.
Light synthetic crude from the oil sands for November delivery last traded at $12.50 per barrel below WTI, compared with a settlement price on Wednesday of $11.75 below the benchmark.
A ramping up of production at Imperial Oil's Kearl project and strong output from Syncrude's northern Alberta oil sands project have pushed differentials wider in recent weeks.
Production from Canada's largest energy company Suncor Energy Inc dipped in September however, falling 16 percent month-on-month to 365,000 barrels per day as a result of maintenance at its U2 upgrader.
Market players said weaker refining margins meant there was less demand from refineries, while Shell Canada's 100,000 bpd Scotford, Alberta, refinery, is also undergoing a full turnaround.
"Margins are diminishing so refineries have lower utilization than in the last two or three months, which is putting pressure on pricing," one Calgary crude trader said.
"As we get more and more production coming out there are also logistical issues."
Pipeline company Enbridge Inc increased apportionment on its export network in October, and some market sources said there were concerns there could be more rationing ahead.
Higher apportionment can push differentials wider on concerns that crude will get bottle-necked in Canada. Last winter congested export pipeline capacity and growing production meant WCS at times traded more than $40 per barrel below WTI, in what the Alberta government termed the "bitumen bubble".