Light, sweet synthetic oil in Edmonton strengthened to the highest level relative to U.S. benchmark crude in three months as maintenance work at two bitumen upgraders threatened to reduce supply.
Syncrude gained $1.75 a barrel to a $1 discount versus West Texas Intermediate at 12:16 p.m., the narrowest since May 30, according to data compiled by Bloomberg.
Canadian Natural Resources Ltd. planned to shut its 110,000-barrel-a-day Horizon upgrader in Fort McMurray, Alberta, on Aug. 16 for 25 days to tie in new equipment, the company said in an Aug. 7 conference call. Husky Energy Inc. is planning six weeks of maintenance at its 82,000-barrel-a-day Lloydminster upgrader in Saskatchewan that will cut production to 80 percent of capacity.
Mining bitumen from oil sands in Alberta has helped Canada become the world’s fifth-largest oil producer, at about 3.95 million barrels a day last year, according to BP Plc.
Outside of what is used by local refineries, bitumen has traditionally been blended into heavy grades like West Canada Select or processed at upgrading complexes into a synthetic crude similar in quality to light, sweet Brent and WTI.