CALGARY – Canadian oil producers are missing out on a recent rally in global oil prices as the discount for domestic crude flirts with all-time highs in recent weeks.
“It has been ridiculous — it’s been outrageous, actually,” said Martin King, director of institutional research at GMP FirstEnergy, about the near-record discounts facing Canadian crude oil production.
While the West Texas Intermediate benchmark has steadily climbed over US$71.89 per barrel — drawing the ire of U.S. President Donald Trump who blamed OPEC for high prices — the main Canadian oil benchmark has at times traded for less than half that price.
King said Western Canada Select, a blend of heavy oil barrels, was trading at a discount of US$34.50 per barrel at mid-day on Wednesday, or roughly half of WTI prices.
Some WCS contracts have traded at a US$40-per barrel discount to WTI but King says those were small trades of high-sour, heavy barrels which traditionally trade at a discount to the lighter WTI oil benchmark.