* March Western Canada Select last at $31.75/bbl under WTI
* March synthetic at $0.75 over WTI
CALGARY, Alberta Jan 30 Canadian heavy oil
prices improved on Wednesday on lighter pipeline restrictions
and improving demand.
Western Canada Select heavy blend for March delivery last
traded for $31.75 per barrel under the West Texas Intermediate
benchmark, according to Shorcan Energy Brokers. That compares
with the day prior settlement price of $33.00 per barrel under
Tight pipeline capacity and refinery maintenance slashed the
price of Canadian heavy oil in January, pushing the discount to
more than $40 per barrel under WTI earlier this month.
The weak pricing led to political turmoil in Alberta, which
relies on revenue from oil and gas production for nearly a third
of its revenue. Premier Alison Redford last week said the
province faced a C$6 billion ($6 billion) budget shortfall
because of the low prices.
But more pipeline space is available in March, allowing more
crude to reach the U.S. Midwest. Enbridge Inc said
earlier this week that its Line 5, which carries 491,000 barrels
per day to refineries in Michigan and Ontario, would be
apportioned by 5 percent next month after cutting back nominated
shipments by 12 percent for January, though restrictions on
other lines would remain about the same.
There are few refinery outages currently cutting into
demand. Flint Hills has closed the 24,000 bpd coker unit at its
Pine Bend refinery in Minnesota, Genscape reported.
Imperial Oil Ltd on Tuesday reported an operational
upset at its 121,000 bpd Sarnia, Ontario, refinery. The company
said it is working to return the facility to normal operation
but did not specify any production impact from the incident.
Synthetic crude for March delivery last traded at a premium
of 75 cents per barrel above WTI, down from a settlement price
on Tuesday of 80 cents per barrel above the benchmark.