* July WCS trades at $11.90/bbl below WTI * Trading window largely shut for Canadian grades By David Gaffen NEW YORK, May 17 (Reuters) - Canadian crude oil pricesstrengthened in light trading on Tuesday after a massivewildfire burning in the oil sands region gathered strength,forcing evacuations by producers and putting off expectedrestarts of production. The sudden movement of the wildfire caused Suncor EnergyInc, one of the area's biggest producers, to shut its baseoperations that had been expected to restart in coming days. Thecompany and fellow operator Syncrude Canada evacuated workersfrom key installations north of the hub of Fort McMurray. "This is quite an unexpected U-turn in events," said JackieForrest, vice president in energy research at ARC FinancialCorp. "It's realistic to think this outage is going to lastabout another couple of weeks." Around 1 million barrels per day of oil sands crude was shutin early this month because of the out-of-control fire, whichburned parts of Fort McMurray and forced some projects toevacuate workers. Very little trading was actually seen in Canadian crudegrades, however. The bulk of trading in Canadian oil takes placeduring the 2-1/2-week-long monthly trade cycle, which lasts fromthe first of each month until the day before pipeline volumenominations are due. Volumes are likely to be thin for theremainder of the month. Traders in Calgary said the relatively muted Canadian crudeprice response to the outages so far was due to the lack ofactual damage to oil sands facilities and supply shortages beingmet by crude drawn from storage. "Some of the Canadian grades haven't been as affected asmuch as one might think but that might be because there's somuch oil out there that the market is turning a bit of a blindeye towards it," said Gene McGillian, senior analyst atTradition Energy in Stamford, Connecticut. Even so, light synthetic crude from the oil sands for Junedelivery jumped to $2.50 per barrel above the West TexasIntermediate benchmark, according to Shorcan Energy brokers, upfrom $1.45 per barrel over on Monday. The Syncrude facility and Suncor's base plant operations,which together produce nearly 700,000 bpd of synthetic crude,were shut down on Monday evening as the fire moved closer. There were no trades in Western Canada Select for Junedelivery, but July WCS traded at $11.90 per barrel below WTI,after settling at $12.30/bbl below WTI Monday. U.S. crude was lately trading at $48.43 per barrel, afterearlier hitting a seven-month high of $48.56. (Additional reporting by Nia Williams in Calgary; Editing byCynthia Osterman)
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