Alberta oil cuts will slow Canadian economy next year, banks predict

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Alberta oil cuts will slow Canadian economy next year, banks predict

"While Saskatchewan understands the action taken by our neighbours in Alberta to reduce the oil glut that is depressing the Western Canada Select oil price, the impact of the differential and how it is spread across our energy sector represents a different challenge to our province", Moe said in a Monday statement.

Rachel Notley calls the move "a short-term measure" amid pipeline bottlenecks.

"But right now, they're being sold for pennies on the dollar". "We are essentially giving our oil away for free. this is not sustainable".

The reduction amounts to 325,000 barrels a day of raw crude and bitumen, or about 8.7 per cent of daily production.

And there is no sign whatsoever that any method developed to ship Alberta oil - whether in the form of rail cars, new pipelines or rehabilitated old ones - will not eventually be used to its fullest capacity, with predictable impact on global climate change.

Cutting 325,000 barrels of crude oil and bitumen will be temporary and will be implemented starting January. When Enbridge's Line 3 starts pumping at the end of next year, that, too, will increase demand and raise prices - although too late for the NDP's electoral strategy.

Last week, she announced a plan to buy rail cars to help ship an additional 120,000 barrels of crude a day, increasing already-record levels of crude shipped by train by more than 30 percent.

"Ottawa's failure in this area has left Alberta's energy producers with few options to move their products, resulting in serious risks for the energy industry and Alberta jobs", reads a release from the province.

The curtailment plan, which will apply to both oil-sands and conventional producers, should narrow the discount between Western Canada Select and USA benchmark oil by at least $4 a barrel and add an estimated C$1.1 billion ($840 million) in government revenue in the fiscal year starting April 2019, according to the statement.

"With oil prices lower and production cuts on the horizon, it's less of a reason for the Bank of Canada to come out very hawkish later this week", Mendes said by phone Monday.

The Trans-Mountain line to the B.C. coast is now in legal limbo despite being approved two years ago.

The U.S.is the only country now purchasing Alberta oil.

Reaction to the curtailment from United Conservative Party leader Jason Kenney and Alberta Party leader Stephen Mandel was swift.

It barely took Notley 10 minutes of her live-streamed news conference, which began at 6 p.m., to prove that even in this neoliberal era governments can act, and do so decisively.

Imperial Oil CEO Rich Kruger said the government intervention could do long-term damage to the market, but that his company would comply with the order. Industry groups and pundits scolded protestors, declaring that the oil would find its way to the market one way or another. She was steely-eyed and - dare I say it - at some moments evocative of Margaret Thatcher on the eve of that war at the south end of our then-still-chilly planet.

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