Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Canadian Heavy Oil Weakens to Four-Week Low on Enbridge Limits

Don't Miss Out —
Follow us on:

Jan. 11 (Bloomberg) -- Western Canada Select heavy oil weakened to a four-week low in the wake of cuts to the flow rates on the largest pipeline system exporting crude to the U.S.

Enbridge Inc. said yesterday it apportioned by 10 percent Lines 4 and 67, which take heavy oil from Alberta to Superior, Wisconsin, after power outages and electrical equipment issues. Combined, the lines can move as much as 1.25 million barrels of heavy crude a day when they operate at full capacity.

Western Canada Select, an oil-sands bitumen blend, declined by $4 to a $41-a-barrel discount to U.S. benchmark West Texas Intermediate oil at 11:29 a.m. New York time, according data compiled by Bloomberg. It was the weakest price since a record discount of $42.50 was reached on Dec. 14.

Pipelines out of Alberta have been filled to capacity in recent months as Canada’s oil production has outgrown its transportation infrastructure. Canada exported 2.3 million barrels of oil a day during the third quarter of 2012, up 4.5 percent from the same period a year earlier, according to the National Energy Board.

Longer-dated spot contracts to deliver WCS also weakened, indicating traders expected pipeline congestion to continue to be a problem for Canadian oil in the coming months. WCS for delivery in the second quarter fell by $1 to a $33.50 discount, according to Net Energy Inc., an oil broker in Calgary.

Extra production from a new heavy oil project, Imperial Oil Ltd.’s 110,000-barrel-a-day Kearl mine in Alberta, is expected to begin production early this year, adding to supply that will have to travel through limited pipeline space.

Syncrude slipped $1.25 to a 75-cent discount to WTI.

To contact the reporter on this story: Edward Welsch in Calgary at ewelsch1@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.