The price discount for Alberta oil continues to cause problems.
Patricia Mohr of Scotia Capital says even Mayan Crude out of Mexico, which is similar to bitumen, is selling for 40 dollars more per barrel.
“As of the middle of January, [Mexico] was getting 101 U.S. dollars a barrel,” she said, “compared to us in Canadian select at about 61, and even higher than West Texas Intermediate at 94.”
Mohr says the big reason is because Mexico can get its oil to U.S. gulf coast refineries much quicker.
“They’re on tide water, and they’re very close to the major U.S. refining centre on the U.S. gulf coast,” she said. “If you’re on the U.S. gulf coast, prices are essentially at world levels.”
She says that gap ought to narrow if and when the province gets more pipeline capacity.
January 29, 2013
