Canada crude-Spreads widen as Enbridge cuts more flow

* Western Canada Select heavy $22 under WTI

* Synthetic slips from premium to $1 under

* Cuts in Enbridge oil flows pressure market

CALGARY, Alberta, Aug 17 (BestGrowthStock) – Canadian heavy crude
oil spreads widened as Enbridge Inc (ENB.TO: ) cut flow rates on
a major pipeline being used as an alternative to the one that’s
been shut down since it ruptured in Michigan three weeks ago.

Synthetic crude prices, meanwhile, have weakened from last
week’s premiums to benchmark light oil that were spurred by
outages at two Alberta oil sands plants.

Western Canada Select heavy blend crude for September
delivery was talked at about $22 a barrel under West Texas
Intermediate, about $2.50 a barrel weaker than last week.

Canadian heavy differentials were already wide as asphalt
season neared an end and Enbridge’s 190,000 barrel a day Line
6B pipeline — which serves refineries in Ohio, Michigan,
Pennsylvania and southern Ontario — remained idle due to the
July 26 rupture and oil spill.

On Monday, the pipeline company said it had reduced flow
rates on Line 5 by 8 percent, backing more crude up and leading
to high storage volumes upstream. [ID:nN16270522]

Line 5, which runs to Sarnia, Ontario, from Superior,
Wisconsin, has a capacity of 490,000 bpd.

Enbridge is awaiting a decision from U.S. federal
regulators on its revised restart plan for 6B. The timing of
resuming crude flows on the pipeline is still unknown.

Despite the reduction in capacity, Enbridge has yet to
ration space for shippers.

That is likely because of outages at Syncrude Canada Ltd
and Canadian Natural Resources Ltd’s (CNQ.TO: ) Horizon oil sands
operations, which left some breathing room on the system, which
carries most of Canada’s crude exports to the United States, a
trader said.

WTI was up 89 cents at $76.13 a barrel late in Tuesday’s
session as stronger U.S. corporate earnings eased worries about
the economy and a weaker dollar made commodities cheaper for
holders of other currencies. [ID:nSGE67G05B]

Light synthetic oil was quoted at about $1 under WTI,
compared with $1 over for the last few weeks. Such a premium
was said to be unsustainable for shipping volumes beyond
Edmonton.

Syncrude, the sprawling oil sands mining and synthetic
crude production venture in northern Alberta, plans to take one
of its coker units, called 8-1, down for 45 days of upkeep
starting next month, work that will cut production by 100,000
bpd. The operation has a capacity of about 350,000 bpd.

Canadian Natural was forced to take its Horizon plant
offline for unplanned work until around the middle of this
month, removing about 100,000 bpd from the market for the
period.

Condensate spreads have tightened. They were heard at about
80 cents under WTI, compared with $1.15 under the benchmark
last week.
(Reporting by Jeffrey Jones; editing by Peter Galloway)

Canada crude-Spreads widen as Enbridge cuts more flow