Canadian crude oil is selling below U.S. West Texas Intermediate crude oil by a record $52.50 per barrel based on records that go back to early 2007. The huge discount is mainly due to a lack of pipeline capacity to move the oil to markets. But, also contributing are growing production from Canada’s oil sands and a reduction in demand due to U.S. refinery maintenance shutdowns. The widening price differentials are costing Canadian producers and governments upward of $40 million a day . A setback for the Canadian oil sector is a court’s overturning the Trans Mountain pipeline expansion approval. Opponents of accessing Alberta’s enormous oil reserves have focused on fighting against pipelines that would bring products to market, similar to tactics used by opponents of energy production in the United States. They understand that the stopping of pipeline construction strands energy. It’s just another way to “keep it in the ground.” Government policy is also making Canada an uncompetitive place to drill for oil and gas. For every well that is drilled in British Columbia, over $100,000 is paid in carbon taxes on the diesel used to drill and complete the well. According to Canadian oil companies, the […]
