Like those farmers, oil producers have filled storage to bursting while they wait for a solution to appear. The price discounts or “differentials” that had mainly affected heavy oil have spread to light oil and upgraded synthetic oilsands crude as pipeline space tightens. Producers’ exposure to WCS prices differ depending on what kind of oil they produce, where they sell it and how they transport it. Other oilsands producers including Canadian Natural Resources Ltd. and Cenovus Energy Inc. are cutting production to avoid selling at current prices. Part of the reason WCS discounts were wider in October is that WTI, which opened the year at $60.37 (U.S.) per barrel, jumped to more than $76 (U.S.).

Source: thestar November 11, 2018 16:07 UTC