Canadian crude by rail jumps in July

Crude by rail traffic out of the Western Canada Sedimentary Basin jumped by more than 25,000 bbls/d in July, reigniting an upward trend that had slowed the previous month.

New data from the Canadian Energy Regulator (CER) shows crude by rail averaged 313,283 bbls/d in July, compared to 286,701 bbls/d in June.

Analysts with Peters & Co. estimate that until a new export pipeline is completed, the WCSB will require at least 400,000 bbls/d of rail and/or curtailments to balance the market.

Carloads dropped to 130,564 bbls/d this February after reaching a new record high of 353,789 bbls/d in December 2018. The decrease in activity was a result of tighter price differentials between light and heavy crude, blamed on Alberta’s curtailment order being set too high in its early stages.

As the order has been eased, rail activity has picked up.

The curtailment is currently set at 125,000 bbls/d for September and 100,000 bbls/d for October, and has been lowered to 90,000 bbls/d for both November and December. The order has been extended to the end of 2020.

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