CANADA-CRUDE-Discount on Western Canada Select narrows for first time since Maduro capture

Jan 9 (Reuters) - The discount on Western Canada Select to North American benchmark West Texas Intermediate futures CLc1 narrowed on Friday for the first time since the U.S. capture of Venezuelan President Nicolas Maduro.

WCS for February delivery in Hardisty, Alberta, settled at $14.80 a barrel below the U.S. benchmark WTI, according to brokerage CalRock, compared with $15 on Thursday.

The discount on heavy Canadian crude has grown by more than 12% in the wake of the Venezuelan situation, as an increase in Venezuelan barrels could compete with similar-in-quality Canadian heavy oil in the U.S. Gulf Coast over the longer term.

The WCS forward curve has widened the most for June, July and December, potentially indicating that market participants believe Venezuelan supply may start to ramp up in the second quarter of this year, said TD Cowen.

But Canada has other factors working in its favour that could help prop up WCS prices if they come under pressure, TD Cowen said, including low oil inventories in the province of Alberta, a depleted U.S. Strategic Petroleum Reserve, and the prospect for Chinese refiners to replace Venezuelan supply with Canadian cargoes.

Oil prices rose 2% on Friday on growing supply worries linked to intensifying protests in oil-producing Iran and an escalation of attacks in Russia's war in Ukraine.