US crude prices were up 1.25 percent at $51.67 a barrel, helped by a fall in US crude inventories and an outage at Britain's largest North Sea oilfield.

Oil is one of Canada's major exports.

Still, gains for the loonie were restrained as caution prevailed in global markets before a potentially tense meeting between US President Donald Trump and his Chinese counterpart Xi Jinping this week.

At 9:06 a.m. ET (1306 GMT), the Canadian dollar was trading at C$1.3389 to the greenback, or 74.69 US cents, stronger than Tuesday's close of C$1.3406, or 74.59 US cents.

The currency traded in a range of C$1.3379 to C$1.3409.

On Tuesday, the Canadian dollar hit a nearly three-week low against its US counterpart at C$1.3455, pressured by a loss of risk appetite and domestic data showing an unexpected trade deficit.

It has retreated 0.7 percent this week after finishing the first quarter with a 1 percent gain.

The US dollar was little changed on Wednesday ahead of the release of minutes from the last US Federal Reserve meeting even as US private employers added 263,000 jobs in March, well above economists' expectations.

Canadian government bond prices were slightly lower across the yield curve, with the two-year down 2 Canadian cents to yield 0.749 percent and the 10-year falling 5 Canadian cents to yield 1.588 percent.

On Tuesday, the 10-year yield touched its lowest in four months at 1.545 percent as US Treasury yields declined on doubts about the ability of US President Donald Trump to enact fiscal stimulus.

Canada's employment report for March is due on Friday.