Gap Between US Oil, Canadian Oil Narrows -- WSJ; Keystone? Who Needs The Keystone

Updates

May 12, 2014: The New York Times sees it differently.
 

Original Post

The Wall Street Journal is reporting:

Canadian oil prices are surging, narrowing the gap with U.S. crude, as new pipelines connect producers with previously hard-to-reach Gulf Coast refineries 2,000 miles to the south.

The price of Canadian oil has climbed nearly 60% since November, helping drive up shares of suppliers north of the border.

Until recently, crude from Alberta's oil-sands region sold at a steep discount to the U.S. oil benchmark because producers had difficulty getting it to buyers. In November, Western Canadian Select, the benchmark for crude produced from Canadian oil sands, traded US$40 a barrel below West Texas Intermediate, the main U.S. benchmark.

In past years, pipelines haven't kept up with the increased flow out of Canada. The torrent of oil from the U.S.'s biggest crude supplier got trapped in storage tanks across the Midwest, and rising production in the U.S. exacerbated the glut. But one of the worst chokepoints loosened in January, when a pipeline opened linking a major oil hub in Oklahoma to refineries in Texas and Louisiana. The price of Canadian oil has since risen to $80.67 a barrel as of Tuesday, about $18 below WTI. Traders say a gap of about $20 is right, given that WTI is a higher-quality grade of oil and doesn't need to be transported as far to U.S. refineries. 

Keystone? Who needs the Keystone? Presidents come and go. I don't talk about it much, but ... no, I'm not going to bring it up now....