Severe winter weather in Canada has helped boost the price for Syncrude oil to the largest premium in almost four years.
Light crudes, such as Syncrude, are used to dilute heavier oils, which helps them move through pipelines from Alberta to refineries in the U.S.
The premium for Syncrude rose against West Texas Intermediate, gaining $1.85 to $10 a barrel, according to data compiled by Bloomberg at 2:07 p.m. in New York, the highest level since April 2007. Syncrude is a light, low-sulfur synthetic oil derived from the tar sands in Alberta.
“There are brutally cold temperatures out in western Canada and this is going to be one of the coldest Marches ever,” said David Phillips, senior climatologist for Environment Canada.
The temperature in Edmonton, Alberta, was minus 11 Fahrenheit (minus 24 Celsius) as of 2:30 p.m. New York time, according to Environment Canada. In Calgary, the temperature was minus 9, and it was minus 7.6 in Saskatoon, Saskatchewan.
Light Louisiana Sweet’s premium narrowed 95 cents to $18.55 a barrel at 2:07 p.m. Heavy Louisiana Sweet’s premium to WTI weakened 75 cents to $18.25.
Among Gulf Coast sour, or high-sulfur, grades, Mars Blend’s premium to WTI weakened $2.15 to $12.85 a barrel, while Poseidon’s premium narrowed $2.75 to $12.75 over the benchmark.
Thunder Horse’s premium to WTI narrowed $1.25 to $17.25. Southern Green Canyon’s premium narrowed $1.75 to $12.25.
West Texas Sour’s discount narrowed 10 cents to $3.75. WTS is delivered in Midland, Texas, so its price is less influenced by imports.
The discount for Western Canada Select narrowed $2.25 to $24.
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