CALGARY, Alberta, June 13 Canadian cash crude
prices strengthened on Thursday, regaining ground after a sharp
fall in early trade on news that Kinder Morgan Energy Partners
LP's 307,000 barrel per day Trans Mountain pipeline had
shut down following a small spill.
Kinder Morgan said around 12 barrels of oil spilled near
Kingsvale, British Columbia. The company did not have details on
when the line, which carries Canadian crude from Edmonton,
Alberta, to the Vancouver area and Puget Sound, would
Western Canadian Select heavy blend for July delivery traded
as low as $15.50 per barrel below the West Texas Intermediate
benchmark, before recovering to last trade at a discount of
$10.75 per barrel to WTI, according to Shorcan Energy Brokers.
That compares with a settlement price on Wednesday of $11.00
per barrel below the benchmark, and was close to the strongest
level for WCS since September last year.
Expectations of increased heavy oil demand from U.S.
refineries helped prices recover.
Oil market intelligence service Genscape reported on
Thursday that all monitored units at Exxon Mobil Corp's
238,600 barrel per day Joliet, Illinois, refinery were back
online after a maintenance turnaround that began in April.
Market players were also focused on BP Plc's 405,000
barrel per day Whiting, Indiana, refinery. Sources familiar with
operations said production at an upgraded crude distillation
unit should be starting within seven to 10 days.
Light synthetic crude from the oil sands for July delivery
climbed to a premium of $12.50 per barrel above WTI. That
compares with a settlement price on Wednesday of $11.25 over the
Synthetic prices have risen this week in anticipation of
tight supply after Syncrude Canada Ltd said a coker at its
northern Alberta oil sands project would be shut for 50 days.
Market sources told Reuters Syncrude production would be cut
by 2.8 million barrels in July.