• 2 days Nuclear Bomb = Nuclear War: Saudi Arabia Will Develop Nuclear Bomb If Iran Does
  • 1 day Statoil Changes Name
  • 2 days Tillerson just sacked ... how will market react?
  • 1 day Russian hackers targeted American energy grid
  • 22 hours Is $71 As Good As It Gets For Oil Bulls This Year?
  • 2 days Petrobras Narrows 2017 Loss, Net Debt Falls Below $85bn
  • 2 days Proton battery-alternative for lithium?
  • 2 days Ford Recalls 1.38 Million Vehicles (North America) For Loose Steering Wheel Bolt
  • 22 hours Oil Boom Will Help Ghana To Be One Of The Fastest Growing¨Economies By 2018!
  • 1 day Country With Biggest Oil Reserves Biggest Threat to World Economy
  • 2 days I vote for Exxon
  • 23 hours HAPPY RIG COUNT DAY!!
  • 2 days UK vs. Russia - Britain Expels 23 Russian Diplomats Over Chemical Attack On Ex-Spy.
  • 2 days Why is gold soooo boring?
  • 2 days South Korea Would Suspend Five Coal - Fire Power Plants.
  • 22 hours Spotify to file $1 billion IPO
Equity Markets Surge Despite Tillerson Exit

Equity Markets Surge Despite Tillerson Exit

Markets are enjoying a less-threatening…

Mexico’s U.S. Oil Sales Benefit From Canadian Outage, OPEC Cuts


As some supply disruption from Canada’s heavy crude oil supply to the U.S. is coinciding with reduced shipment to the U.S. from OPEC, analysts say that Gulf Coast refineries are expected to buy this month as much Mexican crude as they can, because higher Canadian crude prices make the similar Mexican grade cheaper and therefore more attractive.

According to Bloomberg, Syncrude Canada has advised customers that they would not get any April supply from the 350,000-bpd upgrader that turns bitumen from the oil sands into light synthetic crude. Following a fire at the upgrader last month, Syncrude Canada has moved forward its maintenance activities, people familiar with the matter told Bloomberg.

The Western Canadian Select grade was trading at a discount of $4.117 per barrel to Mexico’s similar Maya grade on Monday, the smallest discount since the May 2016 wildfires in Alberta, Bloomberg’s figures show. The small spread with the Mexican grade is too uneconomical to cover the $7 per barrel cost to send heavy Canadian crude to the Gulf via pipeline, Carl Evans, an analyst at Genscape Inc, told Bloomberg.

Probably the Gulf will take as much Mexican as it can,” Evans noted.

The price of Western Canadian Select also jumped to the lowest discount to WTI - $10.50 – in nearly two years, according to Bloomberg data.

U.S. imports of Mexican crude oil have been dropping since 2010, and halved from 1.152 million bpd in 2010 to 582,000 bpd in 2016, data by the EIA shows.

U.S. imports from Canada, on the other hand, jumped from 1.970 million bpd in 2010 to 3.256 million bpd in 2016, with new pipeline capacity opening up.

Related: Putin Says Russia Will Become World’s Top LNG Producer

The U.S. energy trade with Canada accounted for about 5 percent of the value of all U.S. exports to Canada and more than 19 percent of the value of all U.S. imports from Canada in 2016, according to EIA data from last month. For 2016, the value of U.S. energy imports from Canada was $53 billion, while the value of U.S. energy exports to Canada was $14 billion.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:

Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News