Saudis sacrifice to broker oil production cuts

Until recently, the nation has insisted it wouldn’t unilaterally cut output until others agreed to contribute. All that has changed

Saudis sacrifice to broker oil production cutsSaudi Arabia is back in its role as the swing crude oil producer of the world. Until recently, the nation has insisted it wouldn’t unilaterally cut output until others, including Russia, agreed to contribute. But all this changed – almost overnight. On Jan. 4, while the ministers from Organization of Petroleum Exporting Countries and its…

Oil markets still face uncertain future

Even if the vaccines remain effective against the new COVID-19 mutants, a true crude oil market rebound is still a long shot

Oil markets still face uncertain futureStrong headwinds continue to disrupt crude oil markets in the new year. In 2020, COVID-19 triggered demand destruction, with some insisting that global oil demand may have already peaked. Lifestyles changed – apparently forever. Working from home became the new norm, commuting to the workplace became extinct and flying became less prevalent. All these factors…

Why oil and gas are fundamental to Canada

The $493 billion in oil and gas revenues paid to governments since 2000 is more than family allowance and children’s benefits since 1970

Why oil and gas are fundamental to CanadaBy Mark Milke and Lennie Kaplan Canadian Energy Centre Humans are wired to respond to stories that paint a relatable picture of an issue at hand. And those stories are easier to remember. If we repeat a Rex Murphy story about how out-of-work cod fishery workers from Newfoundland saved their homes and marriages by moving…

U.S. natural gas producers benefit from Canada’s retreat

Less supportive policies and regulatory constraints has led to natural gas stagnation in Canada

U.S. natural gas producers benefit from Canada’s retreatBy Mark Milke and Lennie Kaplan Canadian Energy Centre The United States has undergone an energy renaissance of sorts in recent years. After decades of importing significant volumes of natural gas, there has been a transformation in both the economy and policy on that source of energy in particular. Americans began to produce and export…

Why Ontarians should care about Alberta oil and gas

Alberta’s consumers, businesses and governments were responsible for $31.4 billion of Ontario’s total interprovincial trade in 2016 alone

Why Ontarians should care about Alberta oil and gasBy Mark Milke and Ven Venkatachalam Canadian Energy Centre “All politics is local,” as 1980s-era U.S. House of Representatives leader Tip O’Neill put it. O’Neill’s point was straightforward: Voters care about what affects them. That, naturally, is where politicians then aim their promises and rhetoric. What’s true in politics is also true of the economy:…

Energy use forecasts pivot dramatically

Global energy players and major stakeholders are out with their keenly-awaited and immensely researched outlooks

Energy use forecasts pivot dramaticallyEnergy outlook season is here. And it’s not rosy. Global energy players and major stakeholders are out with their keenly-awaited and immensely researched outlooks. COVID-19 has turned 2020 into an unusual year, carrying long-term ramifications for the energy world. The Paris-based International Energy Agency has termed the pandemic a disruption not seen since the “world…

Eight steps to get Canada’s economy restarted

Government can do more by doing less, by unleashing the private sector

Eight steps to get Canada’s economy restartedFederal government schemes and programs to ameliorate the devastation wrought by the ill-considered shutdown of the Canadian economy for nearly three months have focused on compensating individuals and businesses for being unemployed or shutting down. Little thought, thus far, has been given to how to relaunch the economy for a sustained recovery from COVID-19. The…

Weak oil and gas investment still plagues Canada

While oil and gas investment has grown substantially in other parts of the world, Canada has failed to keep pace

Weak oil and gas investment still plagues CanadaBy Mark Milke and Lennie Kaplan Canadian Energy Centre Over the past decade, one oft-heard claim is that oil and gas is a ‘sunset’ industry, where investment in Canada can be expected to decline given a worldwide flight from oil and investment. However, international data (available from 2009 to 2017) show no such worldwide flight…

The global energy landscape is changing fast

Over a fifth of Europe’s energy was generated by solar panels and wind turbines in the first half of 2020

The global energy landscape is changing fastPeak oil demand is approaching fast – and earlier than anticipated. It’s not that oil won’t be required in the years and decades to come. It will still be in demand. But the world won’t be critically, crucially and strategically dependent on oil, as it is today. This year may be the turning point for…

Are we seeing a partial recovery in the energy market?

Supported by all these bullish factors, Brent crude spot prices rose. Yet oil markets also face bearish pressures

Are we seeing a partial recovery in the energy market?Faced with gloom and some good news at the same time, crude oil markets continue to be in a quandary. Retrenchment and lack of capital investment could eventually lead to crude shortages, argued David Messler in a piece in Oilprice.com in June. The shortage could result in firming up of oil prices. Messler also points…

Oil industry facing (c)rude awakening

The game is up: Oil and gas companies can no longer mask their financial frailty

Oil industry facing (c)rude awakeningThe decline in oil demand accelerated by Covid-19 may be a sign of the future. Forty publicly-traded U.S. oil producers wrote down a collective $48 billion worth of the value of their assets in the first quarter of 2020, the U.S. Energy Information Administration reported. Quoting Deloitte, Oilprice.com points out that the collapse in crude…

Reducing emissions would save money for oil sands producers: study

Researchers looked at 15 strategies that would decrease sector’s energy use intensity and found increased profits from all

Reducing emissions would save money for oil sands producers: studyInvestment in new energy-efficient, greenhouse gas mitigation strategies by oil sands producers could net them some important profits, according to a model developed by a research group at the University of Alberta. Engineering professor Amit Kumar and his team investigated 15 strategies covering all areas of the oil sands sector – in situ extraction, upgrading and…

Crude oil marketplace bubble can’t last

Iran, Venezuela and Libya have virtually been forced out of production. But that hasn’t made the lives of other producers easier

Crude oil marketplace bubble can’t lastAn uneven playing field exists in the crude oil marketplace. Two major producers, Iran and Venezuela, face sanctions on their oil sales from the United States. Meanwhile, Libya is in the midst of civil strife. These circumstances mean a considerable volume of oil isn’t available to the markets. Yet the Organization of Petroleum Exporting Countries…

Paris emissions targets carry extra costs for Canada’s economy

The gap between expectations and existing policy is wide. Closing that gap will cost thousands of jobs and devastate whole economic sectors

Paris emissions targets carry extra costs for Canada’s economyBy Mark Milke and Lennie Kaplan Canadian Energy Centre Aspirations are important in life but it’s always helpful to be clear on the means to the desired end, especially if others are involved. A case in point: General commitments by governments in Canada to significantly reduce carbon emissions by 2030, i.e., the Paris commitment. In…

Restart Canada’s economic engine with oil and gas

We can get Canadians back to work by leveraging the sector’s leadership in environmental protection and its export potential

Restart Canada’s economic engine with oil and gas“The country isn’t going to recover unless the oil and gas sector recovers.” These words from federal Natural Resources Minister Seamus O’Regan made headlines and highlight the importance of Canada’s largest industry. The reality is that natural gas and oil play an unarguable role in the national economy. Natural gas and oil are Canada’s biggest…

China the big winner in world oil price calamity

The Chinese have stockpiled huge reserves of low-priced oil, giving them significant geopolitical leverage over Russia and Saudi Arabia

China the big winner in world oil price calamityWith the major stakeholders – Saudi Arabia, Russia and the United States – emerging badly bruised from the last round of the crude oil price war, a new world order is set to emerge. The cost of the battle has been immense to all three. In April, as the battle erupted, the value of Saudi…

Oil industry not dead yet despite disruptions

But a true recovery in oil prices will require an economic recovery, whose timing remains unclear

Oil industry not dead yet despite disruptionsWhile there’s certainly carnage and woe in the oil and natural gas sectors at the moment, reports of the death of the industry are exaggerated. Many climate change activists and their sympathizers have been cheered by the dramatic drop in oil prices that coincided with, and were partly caused by, the COVID-19 pandemic. Prominent among…

Why do Canada’s provinces gamble on the oil markets?

Provincial governments need to be sober, disciplined, realistic and do whatever they can to not lose money for their citizens

Why do Canada’s provinces gamble on the oil markets?While crude oil’s startling and unprecedented recent price plunge into negative territory was notable, it didn’t mean that producers were actually paying others to take oil off their hands. It did point to major problems the industry faces, however. In the short term, the foremost issue is weak demand. And it raised a significant problem…

Want richer First Nations? Say ‘Yes’ to pipelines

There’s no easy way to spur economic opportunity for every remote reserve. But resource-related development will help many

Want richer First Nations? Say ‘Yes’ to pipelines“In less than a decade, the Haisla Nation has leveraged the strategic location of its traditional territory to go from a Nation on the verge of remedial management to an eagerly sought-after partner and key stakeholder in several multi-billion-dollar LNG projects.” – The Haisla First Nation on its website Mark Milke and Lennie Kaplan Canadian…

Oil-rich Saudis squeezed by Trump

Current oil production cuts can’t continue for long or the Saudis, and others, won’t balance their budgets

Oil-rich Saudis squeezed by TrumpThe U.S. is putting extreme pressure on the major oil producers, Saudi Arabia in particular, to cut output, firm up crude markets and ensure the continuity of the U.S. shale revolution. But on the other hand, the administration of United States President Donald Trump doesn’t want oil prices to go much higher. In an election…

Oil market finally showing signs of life again

President Donald Trump’s efforts at salvaging the United States shale oil sector seem to be paying off

Oil market finally showing signs of life againSaudi Arabia, Russia and their allies have opted to roll over crude oil output cuts for another month – until the end of July. Markets have somewhat firmed up. Oil prices have inched up. And President Donald Trump’s efforts at salvaging the United States shale oil sector seem to be paying off. The U.S. president…

Canada missing out on natural gas boom – again

The opposition to fossil fuels such as natural gas is driven by magical thinking and is against all empirical evidence

Canada missing out on natural gas boom – againBy Mark Milke and Lennie Kaplan Canadian Energy Centre As the lockdown from the COVID-19 pandemic ends, provincial and federal governments will still face the reality that arrived in its wake: a recession, and one made worse by a domestic energy sector that never really recovered from multiple injuries already in play. Those injuries included:…

Politics helped drive latest Saudi oil production cut

The need to generate cash, along with political pressure, compelled the Saudis to make some bitter decisions

Politics helped drive latest Saudi oil production cutSaudi Arabia has capitulated. A few moves here and there, in Washington and elsewhere, made the trick work. Saudi Arabia made a surprise announcement last week that it would cut its crude oil output by a further one million barrels per day (bpd) from planned June levels, “voluntarily.” This takes the total Saudi production cuts…

Why May, Blanchet are dead wrong about oil’s future

Stores will open again, cars and trucks will begin to run and planes will fly. Our lives will continue – and life takes energy

Why May, Blanchet are dead wrong about oil’s futureFederal Green Party Leader Elizabeth May recently said “oil is dead” and her “heart bleeds for people who believe the sector is going to come back.” It’s foolish to assert “oil is dead” at any time, but it’s particularly ignorant to say it in the midst of an unprecedented global crisis. Canadians are relying on…

Exploding myths about energy subsidies in Canada

Despite claims by some that ‘oil is dead’ and that the sector is heavily subsidized, the evidence suggests otherwise

Exploding myths about energy subsidies in CanadaBy Mark Milke and Lennie Kaplan Canadian Energy Centre In the ongoing debate over whether Canada’s oil and natural gas industry will or should survive, one argument often advanced is the notion that oil and gas activity in Canada survives only due to massive subsidies from taxpayers. The debate has been fuelled recently by comments from…

Practical ways to tackle our emissions problems

Climate warriors spend a great deal of time condemning current practices without offering realistic solutions

Practical ways to tackle our emissions problemsIn the past several months, we’ve heard dire and angry imprecations and accusations from the new climate crusaders. They demand total obeisance to their escalating demands. Any critics to their approach to catastrophic global warming are denounced as deniers or heretics. A new religious-political-social movement has sprung out of this trend: Extinction Rebellion, with the…

Death of Canada’s oil and gas sector greatly exaggerated

Neither the lockdown not government diktat will end our dependence on fossil fuels for quite some time

Death of Canada’s oil and gas sector greatly exaggeratedBy Mark Milke and Lennie Kaplan Canadian Energy Centre In 1897 while in London in the midst of a worldwide speaking tour, American author Mark Twain became the subject of rumours back home that he was dead. To discover the truth, a reporter from the New York Journal wrote to Twain to ask if he…

Trump picking a fight with Iran won’t save oil prices

He needs to do something to boost his electoral fortunes, with the presidential election looming in November

Trump picking a fight with Iran won’t save oil pricesIs American President Donald Trump beating war drums in the Middle East to prop up the ailing crude oil industry? After having failed to turn around the oil markets by engineering an unprecedented output cut deal between Saudi Arabia and Russia, Trump seems to be looking desperately at other options. The crude oil industry is…

Is the world’s most powerful economy unravelling?

Oil prices have taken a catastrophic drop. Unemployment numbers are through the roof. Bankruptcies are raising their ugly heads

Is the world’s most powerful economy unravelling?Monday was the equivalent of a major financial nightmare for the U.S. economy. Oil futures for West Texas crude went below zero for the first time in history and finished at US-$37.63 a barrel. Don’t rub your eyes too hard. That’s a minus, not a plus, next to the dollar figure. What does this mean?…
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