In the following video, Motley Fool energy analyst Joel South takes investors through some of the reasons behind the recent trend of integrated oil companies in the U.S. divesting their downstream operations. While splitting the integrated companies in the U.S. apart has unlocked value for investors, the opposite is true in Canada.
With a shortage of takeaway capacity creating enormous bottlenecks in crude oil distribution, both heavy oil and Western Canadian Select crude are trading at significant discounts compared to U.S.-benchmarked oil. While independent producers are price takers, Canadian integrated oil companies are able to refine their hydrocarbons and receive global pricing for their crude.
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This post was created by Fool.com contributor Joel South.
Fool contributor Joel South has no position in any stocks mentioned at this time. The Motley Fool has no position in any stocks mentioned at this time.