CANADA-CRUDE-Heavy crude discount widens after Keystone pipeline shuts

Dec 8 (Reuters) - Western Canada Select (WCS) crude's discount to the benchmark West Texas Intermediate (WTI) widened sharply on Thursday after the Keystone pipeline shut down because of a leak:

* TC Energy said it had shut its 622,000 barrel-per-day Keystone pipeline, crimping the flow of Canadian oil to U.S. refineries after a spill into a Kansas creek on Wednesday night, and it was unclear how long the closure would last.

* WCS heavy blend crude for December delivery in Hardisty, Alberta, traded at $33.50 a barrel under WTI, according to a Calgary-based broker, widening from $27.50 a barrel under the benchmark the previous day.

* WCS for January delivery traded at $29 a barrel under WTI before paring losses to change hands at $28 a barrel under the benchmark, according to a broker. On Wednesday, January WCS had settled at $26.45 a barrel under U.S. crude.

* The slight recovery in prices suggested traders expect the pipeline shutdown will not last too long.

* WCS differentials have been narrowing this week as benchmark U.S. crude prices dive. The tighter discount helped limit the fall in the outright price of WCS, which was last around $45 a barrel.

* Oil settled lower for a fifth straight session on the prospect of Keystone resuming service, which would return a hefty amount of crude to the market at a time when global economic slowdowns are raising fuel demand fears. (Reporting by Nia Williams; Editing by Josie Kao)