Earlier this month, the price discount for Western Canadian Select (WCS) versus WTI at Cushing blew out to more than $30/bbl — 2.5x what’s typical and a signal that something was seriously out of whack. Well, it turns out that several things were — and to some degree still are — off-kilter, combining to drive down the price of Western Canada’s benchmark heavy-oil blend to its lowest levels relative to WTI in four years. The culprits? Everything from renewed pipeline constraints to a deadly refinery fire in Ohio to the aftereffects of Russia’s invasion of Ukraine, including releases from the U.S.’s Strategic Petroleum Reserve (SPR). In today’s RBN blog, we discuss the recent ups and downs in WCS pricing and the prospects for WCS-WTI differentials to return to a more normal range in the weeks to come. (Hint: This roller-coaster ride ain’t over.)
Roller Coaster – Another Wild Ride for Western Canadian Select-WTI Differentials
