MEGEF - WCS Vs. WTI: Canadian Heavy Crude Discount Demystified

(All amounts in C$ unless otherwise noted)

For investors with exposure to the Canadian crude producers, 2017 was not the exact year they had hoped for. As WTI rallied and investor sentiment buoyed by the OPEC deal, stock prices of Canadian producers have languished even with WTI near US$60 a barrel. We believe it is an important and relevant topic given that most Canadian producers will be impacted by the WCS differential to varying extent depending on their production mix.

We believe one of the recent headwinds for Canadian producers is the weakness in Western