Bloomberg News

Syncrude Slides to One-Year Low as Production Levels Increase

January 06, 2012

Jan. 6 (Bloomberg) -- Syncrude’s discount to West Texas Intermediate oil widened to the largest in a year as Alberta producers boosted output and ultra-low-sulfur diesel tumbled last week in Chicago.

Both Suncor Energy Inc. and Syncrude Canada Ltd. this week reported output increases in December. Ultra-low-sulfur diesel in Chicago cost 13.5 cents less than heating oil futures today, compared with an average of 1.85 cents during the past year, according to data compiled by Bloomberg. The discount fell to 25 cents last week, the lowest level in at least five years.

Syncrude, a grade commonly used to boost diesel production, weakened $1.15 to a $1.75 discount to WTI at 4:20 p.m. in New York, the lowest level since Jan. 6, 2011, according to data compiled by Bloomberg. Syncrude is a light, low-sulfur synthetic oil derived from the tar sands in Alberta.

Western Canada Select’s discount to WTI was unchanged at $17.90 a barrel, the steepest level in more than five months.

Light Louisiana Sweet’s premium to WTI gained 20 cents to $11.70 a barrel. Heavy Louisiana Sweet added 75 cents to $13 over the U.S. benchmark.

Thunder Horse’s premium increased $1.80 to $11. Mars Blend added 50 cents to $8.50 over WTI. Poseidon’s premium widened $1.25 to $8.25 a barrel.

Southern Green Canyon’s premium gained 25 cents to $7 over WTI. West Texas Sour’s discount widened 20 cents to $2.10 a barrel below the benchmark price.

--Editors: Margot Habiby, Dan Stets

To contact the reporter on this story: Aaron Clark in New York at aclark27@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net


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