Crude Summit: Canadian oil to compete directly in Asia

Crude Summit: Canadian oil to compete directly in Asia

Calgary, 24 January (Argus) — Canadian crude output will trend higher and compete directly with other waterborne crudes as the market takes advantage of excess pipeline capacity, says Naomi Esfahani, senior advisor at MEG Energy.

"With the Trans Mountain (Expansion) starting up, there will be a substantial amount of crude that has access to west coast Canada," Esfahani said today at the Argus Americas Crude Summit in Houston. That expansion will provide nearly triple the existing 300,000 b/d of pipeline capacity between oil-rich Alberta and the west coast and provide a much shorter voyage to Asian markets.

"These barrels will be able to compete to front-month loadings and compete directly with Dubai-based crudes," Esfahani said, as opposed to the current two-month lag from when they are traded in the US Gulf coast to then being consumed abroad.