CANADA-CRUDE-Discount on Western Canada Select heavy crude narrows

April 1 (Reuters) - The discount of Western Canada Select (WCS) heavy crude to the North American benchmark West Texas Intermediate futures (WTI) CLc1 narrowed on Tuesday.

* WCS for May delivery in Hardisty, Alberta, settled at $9.80 a barrel under WTI, according to brokerage CalRock, after having settled at $10.15 under the U.S. benchmark on Monday.

* The differential between Canadian heavy crude and WTI is the tightest it has been since 2020, said Rory Johnston, energy analyst and founder of the Commodity Context newsletter. The WCS differential more typically sits around $13 per barrel and over the past decade, has only traded at less than $10 a barrel about 10 per cent of the time, he added.

* The remarkably tight WCS discount reflects stronger global pricing for heavy crude relative to lighter grades due to OPEC+ production cuts, strong shipping activity and tighter sanctions on heavy crude producing countries like Venezuela.

* The market has also erased what had been a months-long tariff drag on the relative price of Canadian heavy oil at the start of the year. It is unclear if President Donald Trump's latest tariff announcements expected on Wednesday will include oil.

* Globally, oil prices edged lower on Tuesday as traders braced for reciprocal tariffs that U.S. President Donald Trump is due to announce on Wednesday, which could intensify a global trade war. However, Trump's threats to impose secondary tariffs on Russian oil and to attack Iran fueled supply worries, limiting losses.

* Tuesday was the start of the Canadian crude market's trade cycle, which runs from the first of each month until the day before pipeline nominations are due, and in which the bulk of trading activity takes place.