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Canadian Crude Heavy Market Picks Up Amid TMX Start: Platts

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Energy BulletsHomepageBulletCommoditiesCanada Bank of Canada Market News

Spot trading of arbitrage heavy Canadian crude to Asia has gathered pace in anticipation of the TMX expansion start on May 1, according to Platts.

  • Thus far, four Aframax cargoes of heavy Canadian sour crude were heard sold to Sinochem, Petrochina, and Unipec for June delivery.
  • The last three cargoes were sold at around August ICE Brent minus $5-4$/b on a delivered basis, compared to discounts of $5.5-$5/b for the first WCS cargo, sold in late March to Sinochem.
  • Some market participants in Asia were sceptical that the arbitrage economics would pull TMX barrels to Asia.
  • The lack of Mexico’s Maya crude exports to the USGC narrowing the region’s discounts for heavy sour grades. This could pull cargoes to the region.
  • Additional TMX barrels to Asia come amid a tightening of overall supply for Middle Eastern heavy sour for a second successive month in May.
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Spot trading of arbitrage heavy Canadian crude to Asia has gathered pace in anticipation of the TMX expansion start on May 1, according to Platts.

  • Thus far, four Aframax cargoes of heavy Canadian sour crude were heard sold to Sinochem, Petrochina, and Unipec for June delivery.
  • The last three cargoes were sold at around August ICE Brent minus $5-4$/b on a delivered basis, compared to discounts of $5.5-$5/b for the first WCS cargo, sold in late March to Sinochem.
  • Some market participants in Asia were sceptical that the arbitrage economics would pull TMX barrels to Asia.
  • The lack of Mexico’s Maya crude exports to the USGC narrowing the region’s discounts for heavy sour grades. This could pull cargoes to the region.
  • Additional TMX barrels to Asia come amid a tightening of overall supply for Middle Eastern heavy sour for a second successive month in May.