Monday, February 22, 2016

February This and That

Well one good thing in Alberta is we are having a beautiful winter.  Maybe there is a direct correlation between low oil and higher temperatures. Every one of us here would go down to -40C for an equal hike in oil prices.

Dropping oil prices aren't over yet nor is there any clear indication of when they will rally.

"A growing number of grim forecasts are calling for even that demolished price to fall further. Last fall Goldman Sachs warned oil could hit US$25 as crude storage tanks reached capacity. In December a report from the International Monetary Fund argued new oil flowing from Iran could push prices even lower. This week analysts at Morgan Stanley made the case for US$20 oil based on the strengthening value of the U.S. dollar, which tends to push commodity prices lower." JUMP

Some say that China's economic slump will keep the price of oil low for a long long time.

"They say you don’t know what you have until it’s gone. For Canada’s oil patch, China’s growing demand for oil always seemed like a permanent fixture – an everlasting thirst that would never run dry. Chinese oil consumption skyrocketed after the turn of the millennium, from an average of under 4.4 million barrels per day (bpd) in 2000 to just under 11 million bpd 15 years later. A massive infrastructure buildout in the country was fueling a bonanza, and in April 2014 China surpassed the U.S. as the world’s largest net importer of oil." Read More

 And our current political situation hasn't helped with stability.

“Heightened environmental concerns, a lack of pipeline access to new markets and the unknown impact of the victory by the New Democratic Party in Alberta’s elections last year are causing companies to slow development,” IEA HERE

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