Canadian Crudes Weaken as Oil Sands Production Seen Rising
Canadian crude oils weakened on the spot market after the country’s largest producer said output was rising, increasing supplies.
“I expect that when we post our oil-sands production in a day or two, you’ll see a monthly record of approximately 390,000 barrels a day,” Suncor Energy Inc. (SU) Chief Executive Steve Williams said on the company’s second-quarter conference call yesterday. That level would be up 33 percent from 293,000 barrels in June.
Western Canadian Select oil for September delivery weakened by $1.50 a barrel to a $21.60 discount to U.S. benchmark West Texas Intermediate, according to Calgary oil broker Net Energy Inc. Light Syncrude weakened by 40 cents to a $2.10-per-barrel premium to WTI.
Canadian grades gave up gains of $1.25 a barrel for WCS and 75 cents for Syncrude as Suncor said in its earnings release that Unit 2 of its upgrader in Fort McMurray, Alberta, would be shut for maintenance for about three weeks during the third quarter. Production will be reduced by 50,000 to 60,0000 barrels a day during the work, Williams said, compared with the plant’s normal 350,000-barrel capacity.
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