North America Crude Markets short-term outlook: June 2023

With the start-up of TMX around the corner, Enbridge announced the long-awaited settlement agreement of tolling for the Mainline system. We estimate Hardisty-to-Chicago tolls will be ~$0.55/bbl lower through 2028 compared to the previous tolling period. In this report, we analyze various WCS netbacks and assess if/how the new Mainline tolling affects the competitive landscape for WCSB egress routes once TMX comes online. Meanwhile, WTI Midland was added to the Brent pricing basket beginning in May. The inclusion supports the continuation of an ongoing trend of elevated US exports to Europe, which was largely spurred by European refiners seeking alternatives to Russian crude. With US-to-Europe shipments already reaching record highs in recent months, we discuss our expectations for export volumes going forward.