Despite a global oil rally, Canadian crude is trading well below international peers. In recent weeks heavy Canadian crude has widened its discount to U.S. grades to about $26/bbl. The spread is attributed to multiple effects of Trump-era foreign policy: after Maduro was ousted in January Venezuelan heavy crude increased competitive supply into refiners set up for heavy grades, and a subsequent Iran war pushed tanker freight sharply higher, creating a U.S. heavy crude surplus that damped demand

Despite a global oil rally, Canadian crude is trading well below international peers. In recent weeks heavy Canadian crude has widened its discount to U.S. grades to about $26/bbl. The spread is attributed to multiple effects of Trump-era foreign policy: after Maduro was ousted in January Venezuelan heavy crude increased competitive supply into refiners set up for heavy grades, and a subsequent Iran war pushed tanker freight sharply higher, creating a U.S. heavy crude surplus that damped demand for Canadian barrels. Canada’s sole west-coast export pipeline is at capacity, limiting producers’ ability to obtain higher prices. Mark Carney has backed construction of a new pipeline to the British Columbia coast with 1.0 mln bpd capacity to relieve the bottleneck and allow Alberta crude to price more against Brent.