Tuesday , May 11 2021

Alberta's prime minister to announce measures to deal with the difference in oil prices

Alberto, NRP, Rachel Notley, will announce tonight what many expect will be a compulsory cut in oil production prices to address the fall in the price, which he says cost the provincial treasury $ 80 million a day in lost income.

Notley's announcement is aimed at resolving the difference in the price of Western Canadian choice, the type of oil produced in Alberta, relative to the West Texas Intermediate (WTI) benchmark.

That gap has reached nearly $ 50 a barrel in late October. Analysts share the difference with the lack of capacity for the pipeline to acquire Alberta's market and other factors such as the bottlenecks of the refinery in the United States.

Notebooks will be announced at 6 am MT. Jason Kenny, the leader of the United Conservative Party, the official opposition of Alberta, will respond approximately 30 minutes later.

The PS will broadcast the Notley press conference at CBC.ca and Facebook. Kenny's press conference will be held live on Facebook.

Any change in oil prices has profound effects on the economy dependent on Alberta's resources.

"Prices of fire"

Notebooks faced pressure to take action, especially in the context of the Canadian Federal Court's ruling in August, which halted the construction of the expansion of the Transk pipeline to the west coast.

The so-called differential in prices began to increase in September, rising to $ 47 per barrel in the last 10 days of October.

The gap was $ 28.50 per barrel when the markets closed on Friday.

The problem is caused by overproduction and lack of capacity for the pipeline to market oil, according to the Alberta government. Novels on Sunday said they have 35 million barrels of oil for what it calls "fire sale prices."

Kenny initially called for voluntary production restrictions on the part of the industry, but he changed his mind and proposed a 10 percent reduction last week.

In a speech on Thursday in the Trade Committee in Toronto, Noteli said Alberta wants to buy 80 locomotives, with each train pulling 100 to 120 cars to market the oil.

However, this is a medium-term solution to the current backlog of storage, as it will take time to buy or rent the required railway equipment.

On Friday, Noty used the op-ed to outline the advantages and disadvantages of production in the sector.

Enabling the extension of the status quo will not harm producers who also have refineries, but it will harm smaller companies, which leads to bankruptcies and job losses, she wrote.

If a reduction in temporary production is introduced, Notely said it could help reduce oil supplies and reduce the price gap between Western Canadian and West Texas.

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