*

Canadian crude oil discount to US oil widened after

shutdown

*

South Bow ( SOBO ) stock tumbled to lowest since October

*

Amount of spill is not known yet, pipeline to be shut

until at

least Wednesday

(Adds South Bow response in paragraph 3, stock reaction in

paragraph 6, details throughout)

By Shariq Khan and Georgina McCartney

NEW YORK/HOUSTON, April 8 (Reuters) - The Keystone oil

pipeline from Canada to the United States was shut on Tuesday

after an oil spill near Fort Ransom, North Dakota, its operator

South Bow ( SOBO ) and the state's Department of Environmental

Quality said.

The 4,327-km (2,689-mile) Keystone pipeline is a major

conduit for the supply of crude oil from Alberta to U.S.

refineries in Illinois, Oklahoma and along the U.S. Gulf Coast.

Some U.S. refiners, especially in the Midwest, rely heavily on

the type of oil produced in Canada and delivered by Keystone.

South Bow ( SOBO ) shut down the pipeline after its leak detection

systems detected a pressure drop, a spokesperson said.

The amount of oil that leaked from Keystone is unknown, said

Bill Suess, a program manager at the North Dakota Department of

Environmental Quality. He said he expects the pipeline to be

shut until at least Wednesday.

South Bow ( SOBO ) did not provide an estimate of the size of the

spill or a timeline for the restart.

The company's shares were last down nearly 4% to C$31.99,

after hitting their lowest since October at C$30.99 earlier in

the session. RBC analysts noted that Keystone's physical

integrity is one of the biggest risks for South Bow ( SOBO ) investors.

Oil market participants were bracing for supply disruptions

from the shutdown, two crude oil traders told Reuters,

requesting anonymity as they are not authorized to speak to the

media.

The price of Western Canadian Select crude oil fell to a

wider discount against U.S. West Texas Intermediate crude. WCS

for May delivery traded $11.25 below WTI on Tuesday, compared to

a $9.20 discount on Monday, a broker said.

At least five prior spills have been reported on Keystone

since its start-up in 2010, which took one to three weeks to

resolve, said Rory Johnston, energy analyst and founder of the

Commodity Context newsletter.

The most recent major spill was in December 2022, when

around 14,000 barrels leaked in rural Kansas due to an issue

that originated during construction of the pipeline. It was the

biggest U.S. oil spill since 2013, and shut a portion of the

pipeline for 21 days.