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Oil market analyst Kevin Birn likens Western Canada’s crude supply to a bathtub with a drain that’s too small to keep up with the increasing volume pouring out of the tap. (Jeff McIntosh/The Canadian Press) Oil market analyst Kevin Birn likens Western Canada’s crude supply to a bathtub with a drain that’s too small to keep up with the increasing volume pouring out of the tap. As barrels of surplus oil lap the edge of the tub, desperate producers are forced to sell at rock-bottom prices to avoid a big mess. Meanwhile, no one seems to agree on how to either turn down the tap or install a bigger drain. "You can think of it as a bathtub that’s full. And as long as the bathtub is full, the pressure on the (price) differentials is going to be bad," said Birn, the vice-president of North American crude oil markets for IHS Markit. "So you’ve got to drain it. And building rail, it will help. You’re seeing announcements around production curtailments and that’s an attempt to accelerate the meeting between supply and demand to drain the basin." Alberta Premier Rachel Notley announced this week the province would buy as many […]
