Heavy Canadian Crude Plummets as BP Said to Extend Refinery Work

Heavy Canadian crude fell on the spot market to a new low against the U.S. benchmark after BP Plc was said to delay for at least three months a project to run more heavy oil at its Whiting refinery in Indiana.

West Canada Select tumbled $5.50 to a discount of $42.50 a barrel versus West Texas Intermediate oil at 11:40 a.m. New York time, according to data compiled by Bloomberg. It’s the largest discount since Bloomberg began tracking WCS prices in May 2008.

The new timeline to finish converting a 225,000-barrel-a-day crude unit to process heavy crude is between June 1 and Aug. 15, from the original estimate of March, said a person familiar with operations, who asked not to be identified because the information isn’t public.

BP said on its website that project is scheduled to come on stream in the second half of 2013.

The project will increase the amount of heavy Canadian crude the 420,000-barrel-a-day refinery can process to about 85 percent of total capacity, from 20 percent, according to BP’s website. That would be more than one-fifth of the oil that the Midwest imported from Canada in September.

Syncrude, a synthetic light, sweet oil upgraded from tar-like bitumen from Canada, fell $1.35 to a 50-cent discount to WTI.