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Canadian heavy oil prices fell below US$30 for the first time in more than six years as Bank of Montreal warned that oilsands producers must cut costs.

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Energy companies are tightening their belts in the oilsands, slashing budgets, scrubbing and delaying projects, and laying off scores of contract workers.

With oil hovering around US$50 a barrel, the bounce is suddenly missing from Fort McMurray’s step.

Hotel rooms, typically tough to find, are readily available. About $100,000 has been trimmed from the average selling price of a single, detached home in the past year. People are lining up at the food bank in numbers previously unseen. More staff is being hired and food drives are being planned in hope of keeping up with demand. More donations than ever are coming in, but nowhere enough, executive director Arianna Johnson says.

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Western Canadian Select fell 59 US cents to US$29.85 at 12:28 p.m. Mountain time, the lowest since Feb. 18, 2009, according to data compiled by Bloomberg. The grade’s discount to U.S. benchmark West Texas Intermediate narrowed 80 US cents to US$13.60 a barrel. Crude futures settled at a six-year low of US$43.88 in New York on concern record supply may strain storage capacity.