CALGARY — Oil production cuts announced by the Alberta government will have the desired outcome of reducing steep price discounts on western Canadian crude, but will also create winners and losers, financial analysts say. Shares in the companies most likely to benefit from the move to curtail crude production starting Jan. 1 soared Monday as oil price differentials plunged. Meanwhile, shares in oil producers who had been either benefiting or insulated from the discount prices stayed put or subsided. “There are going to be a number of producers who will shoulder the brunt of the Alberta government’s 325,000 barrels per day in mandated production curtailments of raw crude and bitumen (namely the oilsands producers),” Calgary-based AltaCorp Capital said in a report. “But the broader health of the province is likely to benefit over the medium term from the decision as a result of narrowing differentials and stronger royalty revenue.” Alberta Premier Rachel Notley announced Sunday the province will require companies producing more than 10,000 bbls/d of oil to cut back by about 8.7 per cent (a total of 325,000 bbls/d) until there is enough shipping space on pipelines to improve prices, expected to take about three months. After that, […]
Alberta crude production cuts expected to create winners and losers: analysts
