Canadian Syncrude Oil Unchanged as Export Pipelines Overbooked

Canadian synthetic light oil was unchanged versus West Texas Intermediate after Enbridge Inc. said two pipelines that export the grade to the U.S. were overbooked for October.

Crude shipments on Mainline lines 2 and 3, which transport a combined 678,700 barrels a day from Edmonton, Alberta, to Superior, Wisconsin, will be apportioned by 12 percent in October, the Calgary pipeline company said in a Sept. 21 e-mail.

Syncrude for October delivery finished the October index trading period on Sept. 17 at a $5.80 discount to U.S. benchmark WTI crude and has been unchanged since then, according to Calgary oil broker Net Energy Inc. The differential fell almost $7 a barrel this month as three upgraders that produce synthetic oil are expected to be back to full operations next month, increasing supplies.

“There are upgraders down, but I think the market is already looking beyond that,” said Christopher Macculloch, an oil and gas analyst with Desjardins Securities Inc. in Calgary. “Prices were already quite weak.”

Upgraders, plants that produce synthetic light oil from heavy crude, had been shut down for maintenance in Alberta and Saskatchewan this month and last.

The Syncrude oil-sands upgrader in Alberta restarted on Aug. 27, said the company’s largest owner, Canadian Oil Sands Ltd. Next month, Husky Energy Inc. is scheduled to return the 82,000-barrel-a-day Lloydminster upgrader to service after a 45-day turnaround and Suncor Energy Inc. is scheduled to finish maintenance at one of its two Fort McMurray upgraders.

Western Canadian Select heavy oil, used as a feedstock for upgraders, was unchanged at a $27.25 discount to WTI, Net Energy said.

Before it's here, it's on the Bloomberg Terminal.
LEARN MORE