NorthAmOil: Impact of Trans Mountain expansion on crude trade routes remains in flux

The impact of the expansion of the Trans Mountain oil pipeline (TMX) from Alberta to the Pacific remains in flux.

It was forecast to diminish Canadian heavy crude’s discount versus the US benchmark, but over three months after TMX started operations, the delta has actually widened. This wide differential may be temporary, as new exports routes settle, but it is right now costing oil sands producers much income.

TMX offers an additional 590,000 barrels per day (bpd) of egress from the oil sands of Alberta to the British Columbia coast, for export to the US or Asia.

Most analysts had forecast the difference between Western Canada Select (WCS), a sour crude, versus the US’s West Texas Intermediate (WTI) would shrink to single digits.