* August WCS last trading at $12.50 per barrel under WTI
* August synthetic trading at $4.50 premium over WTI
CALGARY, Alberta, July 2 Canadian heavy crude prices strengthened on Tuesday on news of another refinery restart, while synthetic oil prices were lifted by expectations of constrained supply.
Western Canada Select heavy blend for August delivery last traded at a discount of $12.50 per barrel below the West Texas Intermediate benchmark, according to Shorcan Energy Brokers.
That compares with a settlement price on Friday of $14.25 per barrel below the benchmark. Canadian crude markets were closed on Monday due to a public holiday.
Energy market intelligence firm Genscape reported Phillips 66's 306,000 barrel per day Wood River, Illinois, refinery had returned to normal operations, adding to expectations of increased demand.
Canadian crude prices have been supported in recent weeks by Exxon Mobil restarting its 238,600 bpd Joliet, Illinois, refinery and BP Plc completing the startup of a new 250,000 bpd crude distillation unit at its 413,000 bpd Whiting, Indiana, refinery.
Traders said the delay in production from Imperial Oil Ltd's Kearl oil sands project was also contributing to stronger prices.
Light synthetic crude from the oil sands for August delivery rose to a premium of $4.50 per barrel over the benchmark, compared to settlement price of $3.00 per barrel over WTI on Friday.
Market sources said prices were boosted by anticipation of lower supply in August after Syncrude Canada Ltd said last month that a coker at its northern Alberta oil sands project would be shut for 50 days.
"We don't know whether there is going to be an August production cut, but the market is trading like it thinks there will be one," one Calgary-based crude trader said.
Meanwhile, Suncor Energy Inc and Nexen Inc, owned by CNOOC LTD, have reduced production at their oil sands operations after parts of the Enbridge Inc pipeline system that serves the region were shut down last week following an oil spill.
On Monday Enbridge said it reopened the northern part of its 345,000 bpd Athabasca pipeline at a reduced operating pressure.