CALGARY, Alberta, Dec 2 (Reuters) - Canadian heavy crudeprices weakened slightly on Monday, the first day of theDecember trade cycle, as some market players decided recentgains had gone too far.
Western Canada Select heavy blend for January delivery lasttraded at $31.25 per barrel below the West Texas Intermediatebenchmark, according to Shorcan Energy brokers.
That compares with a settlement price of $30.00 per barrelbelow WTI on Friday.
The discount on heavy crude has narrowed more than $10 perbarrel since hitting $41.50 per barrel on Nov. 5, which was thewidest differential January.
News that BP Plc started up the new coker at itsWhiting, Indiana, refinery and the end of seasonal refinerymaintenance in Canada and the United States fanned expectationsof higher demand and helped prices rally for much ofNovember.
Traders and analysts in Calgary said the market was nowconsolidating after those strong gains.
"There has been a bit of a pullback in differentials andthat's attributed to a little bit of an excessive reaction tosome of the recent bullish news, for example Whiting startingup," said David Bouckhout, senior commodities strategist at TDSecurities.
"Whiting is supportive for the market, but the market may beover exaggerated that just a little bit."
The refinery has undergone a $4 billion revamp to boost itsintake of cheaper heavy Canadian crude to 350,000 barrel perday. However, congestion on export pipelines from Canada to theUnited States means oil sands crude might still struggle to getthere, one Calgary trader said.
Light synthetic crude from the oil sands last traded at $10per barrel below the WTI benchmark, compared with a settlementprice on $9.25 per barrel below WTI on Friday.