Thursday 28 August 2008 OTTAWA: FINGERS OF BLAME POINTED FOR HIGH GAS PRICES
Retailers and refiners blamed each other for the high prices of gasoline. The fingers were pointed during testimony before the House of Commons subcommittee on oil and gas. Committee members are trying to find out how the price of a barrel of crude oil jumped from US$70 to well above US$140 in one year. While the price has fallen since July, gasoline prices have not fallen as quickly. The president of the Canadian Independent Petroleum Marketers Association, Jane Savage, says retailers aren't to blame for high gas prices but that the culprits are speculators in oil markets and the few refiners who set the benchmark prices that retailers pay. But the president of the Canadian Petroleum Products Institute, Peter Boag, denied it, says that refiners have seen their profits lowered by high world oil prices. Mr. Boag also told MPs that Canadians pay the second-lowest prices in the Western world for petroleum products.
Wednesday 20 August 2008 ST. JOHN'S: OFFSHORE OIL PROJECT A GO
The long-delayed Hebron offshore oil project in the east coast province of Newfoundland and Labrador will officially be launched on Wednesday. Premier Danny Williams says his government has signed an agreement with the consortium in charge of the $5-billion project. The main partners in the project are ExxonMobil Oil Canada, Chevron Canada Resources, Petro-Canada, Norsk Hydro and the government itself. The parties concluded a tentative agreement last August after lengthy arguments that ended in the government receiving a 4.9-per cent equity share in Hebron. The development is expected to produce 200,000 barrels of crude oil a day for 25 years.
Saturday 16 August 2008 VANCOUVER: ENERGY EXPLORATION SHIFTS PROVINCES
The government of the Western provinces of British Columbia and Saskatchewan earned $745 million on Thursday in their latest auctions of drilling rights for oil and natural gas. The figure for B-.C. was $502 million and for Saskatchewan $243 million. Both auctions were their second-biggest. At the present rate, both would surpass such transactions in the country's main energy province, Alberta, where many of the most important lots for drilling rights have already been sold. Oil and natural gas have now become B.C.'s most important exports, surpassing forestry products, forestry now being mired in deep depression.
Friday 15 August 2008 LONDON: SHELL GUILTY OF MISLEADING ADS ABOUT OILSANDS
The Shell group of oil firms has been found guilty of false advertising in the UK for having praised its investments in Canada's oilsands region as representing "sustainable development." Britain's advertising regulator has ruled that Shell's ad in the Financial Times newspaper was deceitful because it failed to explain how Shell controls carbon emissions in its oilsands projects. The World Wildlife Fund had complained about the ad to the regulator. Many environmentalists have denounced oilsands production because
Oil Falls Again as the Dollar Strengthens
On Monday, oil traded below $113 a barrel, its lowest level since early May, and the euro, so strong for so long, tumbled below $1.49, its weakest level since February.
Tuesday 05 August 2008 Oil price falls further to $118
Oil prices touch $118 a barrel, the lowest price for three months, as figures indicate supplies are rising.
Friday Jul 25, 2008 Oil prices masking 'export recession'
Oil prices rebounded from a seven-week low yesterday in what traders said was technical trading and a short-covering bounce...
Thursday 24 July 2008 Arctic 'has 90bn barrels of oil'
The Arctic holds some 90bn barrels of oil, equal to Russia's known reserves, according to US government data.
A new study says that the equivalent of 112 billion barrels of oil lie undiscovered beneath the ice and water of the North American Arctic. The report by the U.S. Geological Survey reports that the deposits comprise oil, natural gas and natural gas liquids. The report says that 412 billion barrels of oil equivalent lie undiscovered north of the Arctic Circle, most of it off the coast of Russia. Two of the areas off North America are in dispute, Canada and the U.S. arguing about their border in waters of the Beaufort Sea, with Canada and Denmark arguing about the border between Baffin Island and Greenland.
Thursday Jul 24, 2008 Alaska approves pipeline
Alaska's House of Representatives voted late Tuesday to allow TransCanada Corp. to build a massive pipeline to tap the vast...
Wednesday 23 July 2008 Oil prices continue on downwards
The price of oil keeps on sliding as US demand wanes and a hurricane in the Gulf of Mexico takes a favourable course.
Wednesday 16 July 2008 Oil prices tumble as stockpiles increase
...Light, sweet crude for August delivery is down $6.44 (U.S.) at $132.30 a barrel in morning trading on the New York Mercantile Exchange.
Oil hits new high on Iran fears
Ongoing concerns about oil supplies pushes the price of a barrel of crude to new record highs above $147 a barrel.
Thursday 10 July 2008 OTTAWA: HIGH OIL PRICES REPORTED DOING MORE HARM THAN GOOD
A report by the Bank of Montreal says that soaring oil prices are having an overall negative impact on Canadians and their economy. Douglas Porter, BMO's deputy chief economist, writes that the conventional wisdom has been that the economy benefits on net from higher oil prices because of the country's role as a major and growing energy exporter. But Mr. Porter says that consumers are paying a steep price in terms of high gasoline, electricity and heating expenses. The economist notes that fuel costs have risen to a point at which households spending a record seven per cent of their revenues on energy. Mr. Porter writes as well that industry is suffering greatly from higher production costs and the slowdown in the world and U.S. economies due to fuel costs. According to the economist, the turning point came when the price of a barrel of oil reached US$120. It was trading at about $137 on Wednesday.
Thursday 03 July 2008 NEW YORK: CRUDE PRICE HITS PEAK
The price of light, sweet crude for August delivery closed at a record US$143.57 a barrel on Wednesday, after rising earlier in the day as high as US$144.15. The closing price was US$2.60 above Tuesday's close. The development coincided with a report by the U.S. energy department that crude oil supplies fell by two million barrels last week. Traders expressed fear of possible attacks against Iran, the world's fourth-biggest oil producer, a development that could impel that nation to seize control of the Strait of Hormuz at the entrance to the Persian Gulf. About 40 per cent of the worlld's oil tanker tanker traffic passes through the Strait.
Tuesday 01 July 2008 IRAQ
The government has opened up six immense oilfields to foreign firms. Oil Minister Hussain al-Shahristani says that the six oilfields are "the backbone of Iraqi oil production," and that with its vast reserves his country ought to be the second- or third-biggest oil producer. Opponents of the 2003 war that toppled the government of the late dictator Saddam Hussein who have claimed that the conflict was aimed at allowing Western oil companies access to Iraq's oil wealth are certain to have been angered by the development. Iraq's oil-producing neighbours Saudi Arabia, Kuwait and the UAE keep production under the control of state energy firms.
Sunday 29 June 2008 CALGARY: GAS, OIL PRICES RIDING JUGGERNAUT
A Canadian bank predicts that gasoline and oil prices have only just begun to take off. Canadian Imperial Bank of Canada forecasts that drivers will be paying $1.43 a litre this summer, compared with about $1.23 a litre now, and that it will thus cost about $80 to fill a tank. The report also sees the price of a barrel of crude oil at US$150 by 2010, which will soar to US$225 a barrel four years later.
Tuesday 24 June 2008 MIAMI: U.S. MAYORS UNITED AGAINST CANADA'S OILSANDS
U.S. mayors have voted for a resolution that urges American cities not to use gasoline derived from Canadian oilsands in municipal vehicles. The resolution says that oilsands projects threaten forests and create three times more greenhouse gases than conventional oil exploitation. The statement also complains that the use of gas from oilsands delays the transition in the U.S. to clearner sources of energy. U.S. federal legislation already had forbidden imported alternate energy sources that create more toxic emissions than conventional oil but it apparently won't apply to oilsands.
Tuesday 24 June 2008 DOHA: MINISTER CAUTIONS AGAINST EXCESSIVE OPTIMISM ON OIL PRICES
Natural Resources Minister Gary Lunn says there isn't an instant solution to the problem of soaring oil prices. Mr. Lunn spoke to the CTV television network after the weekend summit of oil producers and consumers which Saudi Arabia had convoked in Jidda. Mr. Lunn says participants agreed that there should be co-operation to bring stability to markets but the markets themselves have to determine prices. The Saudis have blamed speculation, the low U.S. dollar and high fuel taxes for the recent rise of prices.
Monday 16 June 2008 Saudi oil output to rise in July
Saudi Arabia will increase its oil production by 200,000 barrels a day from July, its oil minister tells the United Nations.
Saudi Oil Minister Ali al-Naimi made the oil pledge to Mr Ban on Sunday
Saudi Arabia will increase its oil production by 200,000 barrels a day next month in a move to meet growing world demand, the United Nations says.
The news was announced after UN Secretary General Ban Ki-Moon met Saudi Oil Minister Ali al-Naimi in Jeddah for talks on the high oil price.
Sunday 15 June 2008 Plan Would Lift Saudi Oil Output to Highest Ever
Saudi Arabia’s plan to boost production next month was seen as a sign that the Saudis are nervous about the political and economic effect of high oil prices.
Sunday 15 June 2008 Finance ministers of the Group of Eight industrialized countries, including Canada's Jim Flaherty, ended two days of meetings in Osaka, Japan, on Saturday, vowing to work together to address common problems. The G-8 ministers issued a statement saying that rising oil and commodity prices are threatening global growth. However, they delayed taking any concrete measures until further analysis of the price hikes emerge. The G-8 also called on oil-producing nations to raise production and called for aid to address a looming food crisis in developing nations.
Saturday 14 June 2008 QUEBEC GASOLINE FIRMS GUILTY OF RIGGING PRICES
The federal Competition Bureau has revealed that 11 gas companies and 13 individuals have been found guilty of price-fixing at gas stations in Quebec. The stations found guilty included stations with the Shell, Esso, Petro-Canada, Irving Oil and Ultramar banners but explained that the companies weren't guilty but rather local operators. One company, Ultramar Ltée., was fined $1.9 million and one of its employees fined $50,000. The Bureau says a $2-million fine was levelled against three of the companies and one person who pleaded guilty of conspiracy. The competition watchdog says its investigators found that station operators in such cities as Victoriaville, Thetford Mines, Magog and Sherbrooke telephoned each other to agree on prices.
Thursday Jun 12, 2008 Cut rates, rethink biofuels, OECD urges
The federal government should establish a fund into which it puts windfall revenues from soaring prices for oil and other...
Tuesday 10 June 2008 OTTAWA: OIL TO BE TOP SUBJECT FOR G8 MINISTERS
The federal finance department says that the surge of crude oil prices will top the agenda at the meeting to be attended on Friday and Saturday in Osaka, Japan, by Canada's finance minister, Jim Flaherty, and his G8 counterparts. Officials revealed that the soaring prices have become a concern since the ministers last met in April. The officials say they don't think the trend is the result of speculation but that the ministers will receive a report on the issue from the International Monetary Fund. The sources say that the department interprets the evidence indicates that the price of oil is being driven by high demand from countries like China and India. The officials also noted at a briefing that part of the problem is that some countries, including China, subsidize oil prices, thus negating market forces that would drive demand downwards when prices are high.
Monday 09 June 2008 Oil Prices Raise Cost of Making Range of Goods
Companies that make hard goods using raw materials derived from oil are seeing their costs skyrocket and are pondering difficult choices.
Saturday Jun 7, 2008 Oil jumps nearly 9% higher to record US$139 Oil prices could top US$150 by July 4, one of the busiest U.S. travel holidays, as strong demand in Asia triggers a slowdown in shipments of crude to the United States, investment bank Morgan Stanley said.
"We are calling for a short-term spike in oil prices," the bank said in a research note.
Friday 30 May 2008 As Oil Prices Soar, Restaurant Grease Thefts Rise
The value of processed fryer oil has increased in recent months to historic highs, and there have been reports of thefts from restaurants in multiple states.
Thursday 29 May 2008 Oil stocks still a bargain
It's a matter of when, not if, commodity analysts come out with new, higher targets
Friday 23 May 2008 Double, oil and trouble
The price of oil is beyond $130 a barrel. Where will it stop?
Wednesday 21 May 2008 The Cassandra of Oil Prices
An analyst who heard scoffing when he predicted $100-a-barrel oil now expects the price to reach $200. An analyst at Goldman Sachs, Mr. Murti has become the talk of the oil market by issuing one sensational forecast after another. A few years ago, rivals scoffed when he predicted oil would breach $100 a barrel. Few are laughing now. Oil shattered yet another record on Tuesday, touching $129.60 on the New York Mercantile Exchange. Gas at $4 a gallon is arriving just in time for those long summer drives.
Friday 16 May 2008 Oil and the economy
High oil prices may yet damage the global economy ... more
Friday 16 May 2008 CALGARY: IMPERIAL SUFFERS COURT SETBACK TO OILSANDS PROJECT
A federal judge has confirmed an earlier court ruling that blocks Imperial Oil Ltd. from proceeding with planned $8-billion Kearl oilsands mine in northern Alberta. Imperial was in court last week fighting the federal revocation of a permit to drain a vast stretch of muskeg in preparation for an open-pit oilsands mine. Imperial estimates that the area contains 4.6 billion barrels of recoverable oil.
Wednesday May 14, 2008 Oil surges as Iran mulls cut in output
Oil surged to a record peak near $127 yesterday after OPEC producer Iran said it was studying a plan...
Wednesday 30 April 2008 CALGARY: NEXEN EARNINGS PHENOMENAL
Nexen Inc. says it made a first-quarter profit of $630 million, an increase of 421 per cent over the result a year earlier. The company attributes its excellent quarterly fortunes to strong production and high commodity prices. CEO Charlie Fisher says that his company has now become reconciled with the new royalties rates announced fall by the government of Premier Ed Stelmach. Nexen was one of a series of energy firms which reacted by reducing capital spending in the province. Mr. Fisher told shareholders at the annual meeting that the company is sufficiently encouraged by an improved situation to consider restarting study to develop coalbed methane holdings in central Alberta. Despite having spent $170 million last year in exploration and development of its CBM assets, Nexen stopped the project as part of a $1.2 billion decrease in total spending. Earlier in the month, the government said it would spend more than $1 billion over next five years on programs designed to encourage new deep gas and CBM wells, which Mr. Fischer says restore the economics of the project.
WASHINGTON: ALBERTANS PRESS OILSANDS CAUSE
Alberta's envoy to the U.S., Garry Mar, reports that the province expects an energy working group to classify oilsands fuel as a conventional resource to avoid a restriction on imported energy products. An energy bill approved last year forbids the U.S. government to buy "alternative" fuels that produce more greenhouse gas than other sources. Canada argues that oil from the oilsands is processed in conventional facilities. Mr. Mar says a favourable finding by the working group would be helpful, but that that wouldn't rule out legal action. A coalition of environmentalists wants Canada to slow oilsands projects. Alberta Deputy Premier Ron Stevens joins Mr. Mar in Washington this week to lobby lawmakers and officials.
Saturday Apr 26, 2008 $200 a barrel oil? $75 is more likely
Hang on to your hats as oil shoots above $200 a barrel over the next few years, warns a new forecast from a leading Canadian...
Oil price jumps more than $2
Back above $118. Supply disruptions, heightened tensions in Persian Gulf cited
Oil prices jumped more than $2 to above $118 a barrel yesterday on supply disruptions in Nigeria and the North Sea and fresh tensions between the United States and Iran.
Oil prices are hovering close to $115 a barrel, having crossed the record mark on Thursday after a US inventory report raised concerns about supplies.
US light, sweet crude oil pulled back slightly to $114.82 in New York from the previous day's $115.21 high.
Brent crude hit an all-time peak of $112.83 before falling back slightly.
Wednesday 16 April 2008 NEW YORK: OIL SOARS TO RECORD HIGH
Oil traders on Tuesday pushed prices as high as high as $113.99 a barrel before the price closed at $113.79, up $2.03 from the record close on Monday. Light sweet crude for May delivery went as high as $114.08. Concerns about global supply evidently stoked the trading, due in part to a report by the International Energy Agency that warned that Russian oil production will drop this year for the first time in a decade. Gasoline rose as well, with the American Automobile Association reporting a new average U.S. price of $3.386 a gallon. Analysts predict that prices will keep rising with the oncome of summer.
Saturday 22 March 2008 CALGARY: U.S. APPROVE TRANSCANADA GAS PROJECT
The U.S. Federal Energy Regulatory Commission has approved a project to build a liquefied natural gas terminal in Long Island Sound that is proposed by TransCanada Corp. The Canadian firm's partner in the $1-billion Broadwater Energy LLC project is Royal Dutch Shell PLC. The Commission had deliberated for three years. The project, which still needs approval of several state agencies, would be the first floating LNG terminal in the U.S. It would deliver one billion cubic feet of natural gas a day, enough to fuel four million homes. The Commission rejected criticism by environmentalists that it would offer a tempting target for terrorists and industrialize the water of Long Island Sound, finding instead that the Broadwater project would safely meet the energy needs of New York City, Long Island and Connecticut.
Saturday 15 March 2008 EDMONTON: OILSANDS PERMIT DEMANDED WITHDRAWN
An environmental group has filed a request that the permit granted by Ottawa for the $7-billion Kearl oilsands project planned by Imperial Oil be quashed. The lawyer representing Ecojustice says the permit granted on Feb. 12 should be set aside on the basis of a ruling last week by Federal Court of Canada. That court agreed with Ecojustice and a second group that a federal-provincial panel erred in reporting that greenhouse gases emitted by Kearl would be insignificant when in fact they would be the equivalent of gases emitted by 800,000 cars. The ruling invited the panel to reconsider its evaluation. Kearl is expected to produce up to 300,000 barrels of synthetic crude a day. It would strip-mine 200 square kilometres of boreal forest and wetlands north of Fort McMurray.
Saturday Mar 15, 2008 Running on empty?
Depending on whom you listen to, global oil production has peaked, will peak soon, or may not peak for a very long time.
Wednesday Mar 5, 2008 Oil falls 3% from record high
Oil tumbled nearly three per cent yesterday as rising U.S. inventories and a stock market slide prompted profit-taking ahead... U.S. light crude for April delivery settled down $2.93 at $99.52 a barrel, off an all-time high of $103.95 hit Monday on expectations the Organization of Petroleum Exporting Countries would hold output steady today.
Wednesday 27 February 2008 CALGARY: CANDIDATES WORRY ABOUT RESULTS OF OILSANDS DEVELOPMENT
A poll of candidates in Alberta's election campaign shows many think oilsands development should be controlled. The environmental lobby Pembina Institute survey 192 candidates in 83 ridings and found that candidates representing all five major parties feel to some extent that the government should control oilsands development. Almost all 40 Green Party candidates responded that the oilsands shouldn't be developed too quickly, many Liberals and NDP agreeing in large numbers as well along with three-quarters of Conservatives. However, fewer than one-half of the latter group believed that the government should suspend new projects. Pembina says the Albertans have realized that many campaign issues like inadequate infrastructure, health-care shortages, crowded schools and lack of affordable housing "...are symptomatic of runaway oilsands development."
Tuesday 26 February 2008 CALGARY: HALT DEMANDED FOR OILSANDS LEASES
A group that includes all major oilsands producers has called for a cessation until 2011 of the granting of oilsands leases to conserve land. Alberta Energy includes the companies, the provincial government, First Nations and environmental groups. The group sent a letter to the government six weeks ago requesting a moratorium on the leases to "maintain the conservation opportunity." The amount of land held by industry under lease in northeastern Alberta has doubled in the past five years to almost 30,000 square kilometres. The leases are a source of considerable profit for the government, fetching $650 million last year. Premier Ed Stelmach has said during the current provincial election campaign that his government won't do anything to check oilsands development.
Sunday 17 February 2008 OTTAWA: ENVIRONMENTALISTS DENOUNCE OILSANDS PROJECTS
U.S.-based environmentalists have denounced Alberta's oilsands projects as the "most destructive project on the planet" and accuse the federal government of being an accomplice of the their developers. Environmental Defense recalled the more than 100 government and independent reports on the toxic waste ponds that cover 50 square kilometres and are big enough to be observed from space. The lobby's report also notes that oilsands produce three times more greenhouse gases than the extraction of conventional oil and are likely responsible for acid rain in neighbouring Saskatchewan. The document also mentioned health problems at the Fort Chipewyan, an aboriginal community downstream from the oilsands, where various types of cancer and other diseases have become endemic where they had been unheard of. Environmental Defense blames these woes in part on lax enforcement of federal environmental and fisheries laws and the CO2 emissions reduction targets "set deliberately low" by Environment Minister John Baird.
Monday 11 February 2008 Venezuela threatens to cut US oil
Venezuela president threatens to cut off oil supplies to the US if it continues an "economic war".
Stephen S. Poloz VP EDC Economics Weekly Commentary How low can oil prices go? - January 23, 2008
Oil prices have broken below the psychologically-important $90 level, leading speculators who have bet heavily on $100-plus oil to consider bailing out of the market. For real consumers, in contrast, this is good news – and the question is, how much better can it get?
There is a wide dispersion of views on the future. Just a year ago many thought oil prices were headed below $50, while today some believe they are headed above $100. A non-economist might wonder what changed during the past 12 months to account for such shifts. Certainly, the arguments that are made to support forecasts are not new – rapid growth in Asia, political risk in the Middle East, a perception that conventional sources of oil are drying up, and the like. Past issues | his WN page
Commentary podcast.
Saudi Arabia announced today that contrary to rumours of dwindling oil supplies, they have plenty of oil. In fact, with the most recent estimate, they said they have enough oil to keep screwing us for
the next 300 years. - Jay Leno
Thursday 10 January 2008 RBC Canadian Oil & Gas Research - The WCSB Issue of Scale: Go Big or Go Home
There are many factors that determine the performance of upstream activities such as management, quality of assets, asset class, company size or scale, etc. There exists an inverse relationship between size and historical F&D costs for WCSB conventional upstream activities for large-cap companies. Scale is important as it provides pricing power with respect to service costs, drilling flexibility inherently due to a large land position & infrastructure and permits meaningful exploration/R&D. RBC CM’s investment thesis is that value-creating opportunities exist for shareholders given the increasing motivation for consolidation or restructuring WCSB assets. Unless Petro Canada and Suncor can improve their upstream returns (scale being one issue), restructuring would be positive for shareholders. The value of PCA and SU's upstream WCSB business is $9-$10/share and $3-$4/share, respectively. Nexen’s WCSB conventional upstream business has struggled to create value over the past five years and unless its CBM/shale gas projects are successful, divestment is a serious option. Similarly, TLM's lack of growth combined with their F&D cost performance suggests re-examining its strategic options for its WCSB upstream assets. In part, due to their dominant size and scale, Encana and Canadian Natural Resources have been able to demonstrate reasonable financial upstream performance and even then, conventional production is flat or declining. The issue of creating sufficient scale is accelerating from the increasing maturity of the WCSB. With an industry natural gas decline rate of 19%, 20,000+ gas wells need to be drilled annually to maintain gas production while 5,000 additional gas wells are need to grow production 5% – assuming that many prospects exist. WCSB activities tend to favor producers such as CNQ and ECA given their size or scale. Opportunity exists for NXY, PCA, SU and TLM to create value or improve valuations under restructuring scenarios (lower impact on valuation for NXY and SU). The glass ceiling for WCSB upstream production now appears to be 200 mboe/d, where producers in this range appear to be unable to increase production organically without large-scale acquisitions.
Saturday 05 January 2008 TORONTO: CANADIANS WARNED ABOUT RISING PRICES
Some oil industry analysts say Canadian motorists should prepare to pay at least $1.30 a litre for gasoline this summer, if oil prices stay above the 100-dollar a barrel mark. They say the cost for food, transportation and other services could also go up. Gasoline demand in January is typically low. But Cathy Hay of M.J. Ervin and Associates says if crude oil prices are at the levels they are now when the spring and summer driving seasons start, Canadians can expect sharply higher prices at the pumps. Those prices are already creeping up, hitting as high as $1.16 per litre in some parts of Canada.
Friday 04 January 2008 CALGARY: HIGH CRUDE EQUALS HIGH GASOLINE
Gasoline prices in some parts of Canada are creeping up as crude oil continues to hover around $100 a barrel. The website Gasbuddy.com says the Canadian national average is around $1.07 per litre - up a cent from Wednesday. The average price in Newfoundland and Labrador shot up about three cents to $1.17 per litre from a day ago, going as high as $1.29 in southern Labrador. In oil-rich Alberta, prices were just shy of 98 cents per litre - the lowest provincial average in the country.
Friday 04 January 2008 Volatility of the Markets Carries On in 2008 Oil’s $100-a-barrel price flirtation suggests that traders will see more of the escalation in energy markets that marked the final months of 2007. Crude oil futures for February delivery hit $100 on the New York Mercantile Exchange shortly after noon when a single trader bid up the price by buying a modest lot and then selling it immediately at a small loss. Prices eased somewhat in later trading, settling at $99.62.
Oil keeps getting more expensive—but not because it is running out
NEW YEAR'S EVE has been and gone, but for oilmen, the party continues. On January 2nd, helped across the line by a New York trader eager for bragging rights, the first business day of the year, the price of their product topped $100 a barrel for the first time. Oil is now almost five times more expensive than it was at the beginning of 2002.
It would be natural to assume that ever increasing price reflects ever greater scarcity. And so it does, in a sense. Booming bits of the world, such as China, India and the Middle East have seen demand for oil grow with their economies. Meanwhile, Western oil firms, in particular, are struggling to produce any more of the stuff than they did two or three years ago. That has left little spare production capacity and, in America at least, dwindling stocks. Every time a tempest brews in the Gulf of Mexico or dark clouds appear on the political horizon in the Middle East, jittery markets have pushed prices higher. This week, it was a cold snap in America and turmoil in Nigeria that helped the price reach three figures.
Tuesday 01 January 2008 Oil slipped to just below $96 U.S. a barrel Monday, closing 2007 with the biggest annual gain this decade. U.S. crude futures settled 2 cents lower at $95.98 a barrel. The price of oil has quadrupled in four years, driven by surging demand from China and other developing economies, alongside OPEC production cuts, a weak U.S. dollar, and rising geopolitical turmoil
2007
Wednesday 12 December 2007 Conventional Oil & Gas Trusts – Commodity Price Update
RBC Capital Markets has revised its commodity price assumptions for the remainder of 2007, and for calendar years 2008 and 2009. The assumption changes reflect the continued strength in crude oil, and the on-going weakness that persists inatural gas. The Canadian dollar has retreated back to par versus the U.S dollar, and the Analysts’ are assumthat the currency will remain at pthrough 2009. The revised crude oestimates reflect a price of $85.50/bbfor 2008 (up from $76.50/bbl) and $84.00/bbl for 2009 (up from $74.00/bbl). With regards to natural gas, the Analysts’ have reducedforecast down $0.25/mcf in eto $7.00 from ($6.75) in 2008 and $7.00 (from $7.25) in 2009. RBCCapital Markets believes that the conventional oil and gas trust sector market is dealing with three concerns right now. These are 1) The prospect of trust taxation, which is now 3 yeaway; 2) The potential for distributiocuts, as trusts try to "live within their means" in light of weak natural gas prices; and 3) Fund redemptions ofsome of the large trust unitholders. Overall, RBC Capital Markets has increased its price targets by ~3%, with the biggest increases among the oil weighted trusts. RBC CM;s best ideas among the upstream-only trusts are ARC (AET.UN), Baytex (BTE.UN), Bonavista (BNP.UN), NAL (NAE.UN) and Zargon (ZAR.UN). The team also likes Harvest (HTE.UN) (which harefinery exposure) and Provident (PVE.UN) (midstream exposure).
Wednesday 05 December 2007
Husky and BP forge US$5.5B oilsands alliance CALGARY -- Husky Energy Inc. and longtime oilsands holdout BP PLC have struck a major deal to combine oilsands assets in Alberta with BP's refinery in Toledo, Ohio. thanks Robert Travers
Tuesday 04 December 2007 CALGARY: ENBRIDGE PIPELINE FIXED
The pipeline between Canada and the U.S. that accounts for 16 per cent of the oil exported to the U.S. is back in operation after a fatal accident last Wednesday. Two workers in the state of Minnesota died while trying to put out a fire. Enbridge, Canada's biggest pipeline firm, says it has replaced a 55-metre segment and that the pipeline carrying crude oil between the western province of Saskatchewan to Chicago is operating normally. The cause of the fire is under investigation.
National Post - Sunday, Nov. 25, 2007Oil-rich states can skew other sectors ... Oil-rich states can skew other sectors. New wealth will lead to massive asset bubbles. SeanSilcoff, Financial Post Published: Monday, November 26, 2007. ...
Oil and Gas Commodity Price Deck Change
RBC CM increased its 2008 natural gas price forecast to $7.50/Mcf from $7.00/Mcf. Current storage levels are at 3.5 Tcf, 106 Bcf above last year and 301 Bcf above the 5-yr average. While inventories continue to remain at all-time highs, RBC CM does not foresee natural gas prices weakening at this time. Gas prices are expected to remain between $7-$8/Mcf until winter weather shows some clear direction. Currently, the consensus is calling for a colder winter relative to last year and the past 10-years, although that perspective has warmed from initial cooler expectations. Strong crude prices and some winter anticipation have put a floor on gas prices.
RBC CM has increased its 2008 WTI oil price forecast from $60.00 to $70.00. Oil prices have shown remarkable strength in 2007 as a result of fears of future supply disruption, worries about the ability of OPEC to increase production and pure investor exuberance. The current price is $10-$15 ahead of the fundamentals as there is a premium for potential future supply disruption and/or investor speculation. The current supply cushion is reasonable enough to withstand some minor disruption as there is currently 3.0 MMBopd of OPEC spare capacity and RBC CM expects non-OPEC production growth of 800,000 Bopd in the next 12 months. RBC CM expects to see the oil market soften from current levels in Q1 once it becomes clear that supplies are more than adequate to get us through the winter.
Saturday 01 December 2007 CALGARY: ROYALTY CHANGE CAUSES PETROCAN TO REORIENT
Petro-Canada says the high royalties for oil and natural gas which the Alberta government will impose won't interfere with its profitable oilsands projects at MacKay River and Fort Hills. The government announced in October that it will collect $1.4 billion a year in higher royalties. PetroCan CEO Ron Brenneman added, however, that the company's spending for exploration will shift to the U.S. Rocky Mountains, the Baltic Sea and the eastern Arctic. Mr. Brenneman says he excited by the prospect of beginning to exploit the estimated 12 trillion cubic feet of natural gas which PetroCan owns in the latter region.
October 29, 2007
Friday 23 November 2007 OTTAWA: CHINA'S NEED OF OIL AND MINERALS FUELLING CANADA'S COMMODITY PRICES
The Bank of Canada says that China's thirst for oil and minerals will drive upwards world commodities for years to come and be a key factor in the global demand for Canadian commodities. The central bank's fall review notes that China's economy has been expanding by almost 10 per cent a year and there's no sign that that rate will decline. The bank's report on the subject says that in 2002 China bought 13 per cent of the world's production of metal ores, a figure which increased to 25 per cent only three years later. The Canadian economy has been powered by the rise of global commodity prices since 2002, the year when the Canadian dollar began its rise from below US70 cents to parity this year.
TORONTO: IRVING EMPIRE REPORTED BREAKING UP
The Globe and Mail newspaper reports that the New Brunswick-based empire of the Irving family is going to be broken up. The $6-billion Irving fortune is the third-biggest in Canada. According to the newspaper, the end of the 125-year-old Irving business is due to disagreement of the succession of a new family generation. The Irvings have a gamut of interests including energy, forestry, retail, trucking and news media properties. The business is run by the three sons of K.C. Irving who are now in their 70s. The Globe asked 79-year-old J.K. Irving whether the different branches would become independent of each other, to which he replied, "that's the evolution taking place today." One unnamed source told the newspaper that the ownership structure put into place by K.C. Irving cannot survive and that the Irving business as it is today is coming to an end.
Tuesday 20 November 2007 SAUDI ARABIA
Delegates at the OPEC summit in Riyadh pledged on Sunday to maintain what they called adequate and timely supplies of oil. Some delegates had urged the group to debate the consequences of a weakened American dollar, but the group's final communique made no mention of it. OPEC charges its exports in American dollars, so that a weaker dollar means less profits. The OPEC leaders also addressed criticism that they are failing to contribute enough to fight global warming. Kuwait, the United Arab Emirates and Qater each pledged US$150 million and Saudi Arabia pledged $300 million towards research into climate change and the environment.
Stephen S. Poloz VP EDC Economics Weekly Commentary Bubble, Bubble, Oil in Trouble? - November 14, 2007
Black gold is on a tear again. Oil prices are currently within a hair of the psychologically-sensitive $100 mark, and the trajectory is steep. This is perhaps good news for the oil patch, but given oil’s effect on the Canadian dollar, many are worried. Will the price spike last?
Oil was making headlines of a different sort at the beginning of this year. Markets seemed convinced that conditions were more balanced – North America was surviving the winter heating season, and global growth indeed seemed to be slowing. Prices descended to the $50 per barrel zone in January, and the talk on the street turned to price floors. OPEC was worried about keeping oil at $40, and financial strategists were recommending a shift out of energy holdings. Past issues | his WN page
Commentary podcast.
Sunday 04 November 2007 UNDATED: OIL PRICES SOAR
In New York, light sweet crude rallied 96 cents to $54.45 a barrel. It hit a record high of $96.24 on Thursday. In Vienna, the OPEC cartel reported that its "basket price" jumped to a record $87.61. The basket price is the reference price for output policies of the cartel. It rose about $85 for the first time on Monday.
The fundamentals simply don't justify
current price levels. "By every supply and
demand standard, the oil market is nowhere
as tight as it was in 2004 [when oil was
fetching about $50 a barrel], yet prices
are nearly double now," says Tim Evans, an
energy analyst at Citigroup Global Markets.
One factor contributing to the higher cost
of oil is the dollar's ongoing decline.
Crude oil producers are able to...
Read More...
Saturday 27 October 2007 CALGARY:ROYALTY MELTDOWN DOESN'T MATERIALIZE
The selloff of oil and natural gas stocks that some analysts had predicted because of the Alberta government's royalties increase announced on Thursday didn't pan out. The TSX energy sector actually gained .17 per cent in trading on Friday, as the global price of crude oil hit new heights. The barrel of crude closed at US$91.86 on the Nymex. Shares of companies like EnCana Corp., Suncor Energy and Canadian Oil Sands Trust declined slightly, but shares of Canadian Natural Resources Ltd. and Imperial Oil, the country's largest integrated oil and gas producer, actually rose. PetroCanada, meanwhile, announced that it will carry on with early engineering work on two energy projects worth $15 billion. On Thursday evening, Premier Ed Stelmach said the government will raise royalties by $1.4 billion a year staring in 2009. An independent panel had recommended they rise by $2 billion yearly starting next summer. more Alberta
Wednesday 17 October 2007 CALGARY: ASIAN BILLIONAIRE EXPANDS HOLDINGS IN OILPATCH
A Hong Kong-based firm controlled by Asia's richest man, Li Kashing, has bought TransAlta LP, one of Canada's biggest power trusts, for $629 million. His CKI firm says it will pay unit holders $8.39 per unit. TransAlta LP had been controlled by TransAlta Corp. CKI says the transaction is part of an effort to establish itself in North America's energy sector. Li Kashing already controls Calgary-based Husky Energy Inc. TransAlta Power put itself up for sale in May, saying that the federal government's decision to tax trusts at the same rates as corporations meant that its business model was no longer in the best interest of the unitholders.
Oct. 16 - Crude prices touched $88 for the first time, amid a six-day rally, as geopolitcal tensions kept supply concerns running high.
Crude prices touched $88 for the first time, amid a six-day rally, as geopolitcal tensions kept supply concerns running high.The demand picture was also a contributing factor as America, the world's biggest consumer of heating oil, heads into the winter season.
Tuesday 16 October 2007 Oil Futures Nov. ’07 (OILC : NYMEX : US$86.13), Net Change: 2.44, % Change: 2.91%
World oil demand refuses to be 86’d. On October 10, we wrote: “Turkey’s government has ordered its army to ready itself for a
potential incursion into Iraq to attack the Kurdistan Workers’ Part (PKK) in retaliation for killing 15 Turkish soldiers over the
weekend. It’s just another source of potential instability for this oil-rich region.” Yesterday, that page-16th story hit the front
page and affected oil prices. Turkish lawmakers vote this week whether to allow military attacks within a year against Kurdish
rebel bases in the north of Iraq. America’s Congress is considering whether or not Turkey is guilty of genocide during WWI
against the Armenians and this Turkish vote may be designed as a threat. Critics of the Congressional vote argue that Turkey is
an ally in the Middle East the vote may cause Turkey to make America’s life in Iraq more difficult. Separately, OPEC said its
estimate for world oil demand growth in 2007 remains intact despite the dramatic increase in price. They still hold to a 1.3
million barrel per day increase, or 1.5% growth. They added that while Q3 demand is “normally a low season for world oil
demand,” demand for Q3 “is forecast to be strong.” Their 2008 estimate remains unchanged.
Oct 11th 2007 | ST JOHN'S From The Economist print edition
Heard the one about the rich Newfoundlander?
Time to swap migrants for tourists
WRAPPED in Atlantic mists and storms three hours' flying time east of Ottawa, it was only in 1948 that Newfoundland and Labrador voted by a slim margin to relinquish its status as a British colony to become the tenth province in Canada. To judge from the number of pre-confederation flags in the capital, St John's, many still wonder if they made the right choice. The green, white and pink standard, resembling a washed-out Irish tricolour, is flown from rooftops, draped in shop windows, stencilled on T-shirts and even iced on cookies sold to tourists. “It represents a time when we had more pride,” says Mark Dobbin, the boss of a helicopter service company. “We're not that long in Canada and we haven't been treated very well,” he adds. more
Friday Oct 12, 2007 CALGARY, EDMONTON: ROYALTIES ISSUE ROILS WAVES
The recent report by an independent panel which claimed that the provincial government isn't getting its fair share of oil and natural gas royalties which ought to be raised by about 20 per cent continues to generate controversy in Alberta. Three junior oilsands firms have formed a political alliance to lobby against such an eventuality. Athabasca Oil Sands Corp., Laricina Energy Ltd. and MEG Energy Corp. issued a common statement in Calgary on Thursday saying that the authors of the report seem to have overlooked the fact that oilsands are "costly to develop and produce." The companies says the panel's report doesn't take account of the reality that smaller energy firms take huge risks and develop the technologies that drive Alberta's energy sector. Several of the big energy firms, including EnCana Corp. and Talisman Energy, have said they'll cut investment by between $500 million and $1 billion if the royalties rise by 20 per cent. Meanwhile in Edmonton, opposition NDP leader Brian Mason has demanded that Conservative Premier Ed Stelmach raise the royalties before calling an election. Mr. Mason suspects Mr. Stelmach might promise to do so beforehand and then renege on the promise afterwards because of his party's reliance on contributions from big energy firms.
BBC
Stephen S. Poloz VP EDC Economics Weekly Commentary
Time to swap migrants for tourists