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Canadian Heavy Oil Strengthens as Crude-by-Rail Picks Up

Discount to WTI below $10-a-barrel, the smallest since April
Canadian Pacific Railway sees rail volumes rising 20% in 3Q

'Bomb Train' Terminal Suits Seen Slowing U.S. Oil Independence — Photographer: David Paul Morris/Bloomberg

By

Robert Tuttle and

July 16, 2019, 8:27 PM UTCUpdated onJuly 17, 2019, 5:00 PM UTC

Heavy Canadian crude’s discount to U.S. benchmark futures narrowed to the smallest since April as crude-by-rail shipments were forecast to increase.

Western Canadian Select, an oil sands benchmark, strengthened to a $9.10 discount on Wednesday, data compiled by Bloomberg show. The gap has narrowed $4.15 this month, with $1.30 shed on Tuesday. Prices are closing in on West Texas Intermediate futures after Canadian Pacific Railway Ltd. said crude-by-rail volumes were expected to rise 20% in the third quarter from about 160,000 barrels a day in the second quarter.