Canadian heavy oil actually traded under $50/barrel this week—less than half the price of Brent-priced international crude. It is by far the cheapest crude on the planet right now.
(The industry calls these discounts “differentials”—they would say “the WCS Select differential blew out to $37.50, even $38 today.” This translates into “The Canadian heavy oil benchmark price traded $38 below WTI today.”)
These low prices are from the big increases in oilsands production filling up the pipelines and the refineries in North America—despite the fact that more refineries are switching over their processes to handle more heavy crude.
In fact, fast growing oilsands production is also causing a discount for other Canadian oil producers as well.
Canadian heavy crude under $50 a barrel? The stuff costs around that much just to get it out of the ground. That’s not a profitable state of affairs for tar sands exploiters. In fact, an article from February 2012 in the Toronto Globe and Mail has this passage (bolding mine):
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