Canada Heavy Oil Unchanged as Producers Report Cold Weather Cuts
Canadian heavy crude was unchanged in spot market trading as an Alberta producer said cold weather lowered its production rates.
Baytex Energy Corp. (BTE), a mid-sized producer of mostly heavy oil based in Calgary, said it curtailed operations by as much as 5,000 barrels a day in December due to “severe winter weather, which impacted our ability to deliver crude oil from the field to sales delivery points.”
Western Canadian Select heavy crude for February delivery was unchanged at a $19.50 discount to U.S. benchmark West Texas Intermediate oil, according to Calgary oil broker Net Energy Inc. As cold weather in both Canada and the U.S. hampered energy production earlier this week, the discount had narrowed to $18.50 a barrel on Jan. 7, the smallest in five months, based on data compiled by Bloomberg.
Larger Canadian oil companies Suncor Energy Inc. (SU) and Syncrude Canada Ltd. also reported lower output for December last week, and production disruptions were thought to be widespread across the northern part of the province as temperatures dipped below minus 30 degrees Celsius (minus 22 Fahrenheit).
Syncrude reported that production declined 10 percent to 291,300 barrels a day in December from the month earlier. Suncor reported a 4.6 percent oil-sands decline to 417,000 barrels a day from November.
Also in the Canadian spot market, Cold Lake heavy crude lost 5 cents a barrel against WTI to a $1.10 discount, Net Energy said. The Syncrude light oil grade gained 30 cents to a $2.10 premium.
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