National Economy

[whatnext]

Originally Posted by 1overcosc

Energy East is probably too much money to spend at this point for a sunset commodity. It is a damn shame we didn't built it though - it would have been a hugely valuable asset to have in 2022 when the EU was cut off from Russian oil.

There's a lesson here. Make hay while the sun shines. Don't let opportunity pass us by.

Um, sunset commodity?

Suncor earns $1.6B in first quarter, breaks all-time oilsands production record
By The Canadian Press
Posted May 7, 2024

CALGARY — Suncor Energy Inc. says it earned $1.61 billion in the first three months of 2024, down from $2.05 billion a year earlier.

The Calgary-based energy giant says its first-quarter earnings amount to $1.25 per common share, compared with $1.54 in the first quarter of 2023.

On an adjusted basis, Suncor says its operating earnings of $1.82 billion in the first quarter of 2024 were comparable to $1.81 billion in the prior year’s quarter.

The company attributed its results primarily to higher oilsands sales volumes and refinery production, partially offset by lower price realizations and increased oilsands royalties.

Suncor reported record upstream production of 835,000 barrels per day during the quarter, including all-time high oilsands production of 785,000 barrels per day....

https://toronto.citynews.ca/2024/05/...uction-record/

[Loco101]

Originally Posted by whatnext

Um, sunset commodity?

Suncor earns $1.6B in first quarter, breaks all-time oilsands production record
By The Canadian Press
Posted May 7, 2024

CALGARY — Suncor Energy Inc. says it earned $1.61 billion in the first three months of 2024, down from $2.05 billion a year earlier.

The Calgary-based energy giant says its first-quarter earnings amount to $1.25 per common share, compared with $1.54 in the first quarter of 2023.

On an adjusted basis, Suncor says its operating earnings of $1.82 billion in the first quarter of 2024 were comparable to $1.81 billion in the prior year’s quarter.

The company attributed its results primarily to higher oilsands sales volumes and refinery production, partially offset by lower price realizations and increased oilsands royalties.

Suncor reported record upstream production of 835,000 barrels per day during the quarter, including all-time high oilsands production of 785,000 barrels per day....

https://toronto.citynews.ca/2024/05/...uction-record/

The Trudeau government is doing wonders for the oil industry.

[whatnext]

Originally Posted by Loco101

The Trudeau government is doing wonders for the oil industry.

As a Suncor shareholder, I thank him.

[harls]

Suncor Energy Inc. says it earned $1.61 billion in the first three months of 2024, down from $2.05 billion a year earlier.

Yep, sounds like it's not declining at all.

[casper]

Originally Posted by P'tit Renard

A prominent economist confirming that the Canadian dollar's link to the price of oil is broken:

Posthaste: This 'important driver' of the Canadian dollar is broken, economist says
The loonie appears to be a 'petro-currency' no longer
https://financialpost.com/news/canad...iver-is-broken

The Calgary-based economist said there was a clear break in the relationship between currency and commodity starting in 2016 that has “become acute over the past year.”

Recall that in 2007, just prior to the Great Recession, U.S. benchmark West Texas Intermediate (WTI) rose to about US$140 per barrel, pulling the Canadian dollar above parity with the greenback. Leap ahead to 2022, and a WTI rise above US$100 failed to have a similar effect — in fact, the loonie moved in the opposite direction

He estimated that oil producers reinvested about nine per cent of revenue ($17 billion) into operations over the past year, down from 25 per cent ($28 billion) in 2014.

It’s not so much the drop in reinvestment that is detrimental to the loonie as the fact that most oil majors in Canada hold debt and savings in U.S. dollars since oil is priced in that currency. Declining reinvestment in operations means companies are converting less of the U.S. holdings into Canadian money.

A weaker link between the price of oil and the Canadian dollar doesn’t just stop with the currency but will feed into higher inflation as the loonie receives less of a boost from rising oil prices.

It could also have implications for the Bank of Canada and interest rate policy.

“Higher oil prices will be, in general, more inflationary and could lead to the BoC being more sensitive to energy prices when setting monetary policy,” he said.

So, I think the strategic impact going forward is clear. To avoid this volatility we need to have a plan to transition off oil as a major energy source in Canada. We can continue to export it, that is ok, the rest of the world can still be dependent on it. But at the same time lets reduce Canada use and dependance. We have a clear alternative, clean green electricity. Hydro, nuclear, wind and solar.

Originally Posted by Loco101

The Trudeau government is doing wonders for the oil industry.

I know. The Liberals were trying to be pragmatic at moving forward with the pipeline. They had to compromise on their commitment to protect the environment.

While it likely was the correct decision for the country, we should be cognitive that a close eye will be needed to ensure the operator is diligent in protecting the environment.

[Hecate]

To lithium and beyond! Screw the tar sands we need more lithium mines! Cause that’s so much better! lol

[ToxiK]

Originally Posted by Hecate

To lithium and beyond! Screw the tar sands we need more lithium mines! Cause that’s so much better! lol

Yes, it is.

[Truenorth00]

Originally Posted by whatnext

Um, sunset commodity?

Yes. Sunset doesn't mean no revenue at all or even that there won't be additional revenue growth.

[1overcosc]

Originally Posted by whatnext

Um, sunset commodity?

Suncor earns $1.6B in first quarter, breaks all-time oilsands production record
By The Canadian Press
Posted May 7, 2024

CALGARY — Suncor Energy Inc. says it earned $1.61 billion in the first three months of 2024, down from $2.05 billion a year earlier.

The Calgary-based energy giant says its first-quarter earnings amount to $1.25 per common share, compared with $1.54 in the first quarter of 2023.

On an adjusted basis, Suncor says its operating earnings of $1.82 billion in the first quarter of 2024 were comparable to $1.81 billion in the prior year’s quarter.

The company attributed its results primarily to higher oilsands sales volumes and refinery production, partially offset by lower price realizations and increased oilsands royalties.

Suncor reported record upstream production of 835,000 barrels per day during the quarter, including all-time high oilsands production of 785,000 barrels per day....

https://toronto.citynews.ca/2024/05/...uction-record/

It absolutely is. Oil will always be around for synthetics, but that's less than half of global demand. It will be just one of many commodities that exists in the market, but not a dominant one anymore. Kind of like how the whole world geopolitical trading system used to revolve around black pepper & cinnamon. We still eat black pepper & cinnamon, but it's not a central commodity to the global economy anymore.

Huge pipeline projects are investments that take decades to pay off. Maintaining that bull run until 2050 is a big risk to take if you're looking at 10 figure construction costs.

That's actually one of the reasons why oil & gas stocks are paying such big dividends. There's not much else for them to spend their profits on.. other than giving it out to their shareholders.

[svlt]

Originally Posted by Truenorth00

Yes. Sunset doesn't mean no revenue at all or even that there won't be additional revenue growth.

We also don't necessarily define the length of time the sun takes to set. Eventually, someday, if human civilization makes it there, we will probably stop using fossil fuels to power the bulk of society.

But the O&G industry isn't going away in "net-zero" year 2050. Not even in 2100.

[casper]

Originally Posted by 1overcosc

It absolutely is. Oil will always be around for synthetics, but that's less than half of global demand. It will be just one of many commodities that exists in the market, but not a dominant one anymore. Kind of like how the whole world geopolitical trading system used to revolve around black pepper & cinnamon. We still eat black pepper & cinnamon, but it's not a central commodity to the global economy anymore.

Huge pipeline projects are investments that take decades to pay off. Maintaining that bull run until 2050 is a big risk to take if you're looking at 10 figure construction costs.

That's actually one of the reasons why oil & gas stocks are paying such big dividends. There's not much else for them to spend their profits on.. other than giving it out to their shareholders.

Exactly, if the oil sands did not exist today, the oil sector would not be investing to build it out. The world has changed. Same thing for oil pipelines. The only people willing to take on that type of risk is the government.

LNG is a different story for the time being.

[WarrenC12]

Originally Posted by casper

Exactly, if the oil sands did not exist today, the oil sector would not be investing to build it out. The world has changed. Same thing for oil pipelines. The only people willing to take on that type of risk is the government.

LNG is a different story for the time being.

Didn't the government do the initial oil sands investment in the 60s(?)

[Truenorth00]

Originally Posted by svlt

We also don't necessarily define the length of time the sun takes to set. Eventually, someday, if human civilization makes it there, we will probably stop using fossil fuels to power the bulk of society.

But the O&G industry isn't going away in "net-zero" year 2050. Not even in 2100.

Sunset doesn't even mean that consumption of a given commodity or service stops. So while oil use will not going away by 2100, it can certainly diminish substantially given that nearly half of global oil consumption is for road transport. Add in rail shipping, power generation and oil refining itself and that's 60% in total that will definitely be reduced by technological advancement itself over time.

I'm not even talking about stuff like electric airplanes. Doing things like electrifying rail and swapping oil power plants for natural gas and renewables. Deploying more EVs over time. Etc. These are all changes already underway. And as they cut oil consumption, it also drives down the oil consumed in refining further driving down demand. If all this sounds implausible to you, just consider that American oil consumption peaked in 2005 and has basically started downward after that, despite their population growing 15% and economy growing by 90%. And for most of that time EVs haven't really even been available. Just imagine what the tech we have now and the improvements coming, will do over the next 20 years.

[YOWetal]

Originally Posted by casper

Exactly, if the oil sands did not exist today, the oil sector would not be investing to build it out. The world has changed. Same thing for oil pipelines. The only people willing to take on that type of risk is the government.

LNG is a different story for the time being.

This is not true. There is plenty of high cost oil investment by the private sector. Exxon just decided to spend $10 Billion+ off the coast of Guyana. And there are many other smaller offshore decisions that were made over the past year. The investment environment in Canada is uncertain. The risk of a windfall tax or carbon tax or total expropriation in the form of a cap is higher than the risk of Guyana nationalizing the resource.

[WarrenC12]

Originally Posted by Truenorth00

Sunset doesn't even mean that consumption of a given commodity or service stops. So while oil use will not going away by 2100, it can certainly diminish substantially given that nearly half of global oil consumption is for road transport. Add in rail shipping, power generation and oil refining itself and that's 60% in total that will definitely be reduced by technological advancement itself over time.

True, but look at coal mines for what happens to investment in extraction.

[Truenorth00]

Originally Posted by YOWetal

This is not true. There is plenty of high cost oil investment by the private sector. Exxon just decided to spend $10 Billion+ off the coast of Guyana. And there are many other smaller offshore decisions that were made over the past year. The investment environment in Canada is uncertain. The risk of a windfall tax or carbon tax or total expropriation in the form of a cap is higher than the risk of Guyana nationalizing the resource.

Have you seen the quality of Guyanese oil? I guarantee you Exxon would not spend the same money here if we allowed tailings to be poured into our drinking water.

[casper]

Originally Posted by WarrenC12

Didn't the government do the initial oil sands investment in the 60s(?)

I believe it is private sector with very significant government backing. Likely would never have come to to be without funding from the federal government.

What many people forget is significant parts of the Canadian economy have come to be due to targeted government spending. While I think we would all like to see the private sector move into new areas on its own that is not always the case.

Originally Posted by YOWetal

This is not true. There is plenty of high cost oil investment by the private sector. Exxon just decided to spend $10 Billion+ off the coast of Guyana. And there are many other smaller offshore decisions that were made over the past year. The investment environment in Canada is uncertain. The risk of a windfall tax or carbon tax or total expropriation in the form of a cap is higher than the risk of Guyana nationalizing the resource.

Relatively small project in comparison. The Exxon offshore project is to produce 250,000 barrels a day or relatively low cost oil. Oil sands in Canada is what 3.5 to 4 million barrels a day with more expensive infrastructure and a higher production cost.

[kwoldtimer]

Originally Posted by casper

I believe it is private sector with very significant government backing. Likely would never have come to to be without funding from the federal government.

What many people forget is significant parts of the Canadian economy have come to be due to targeted government spending. While I think we would all like to see the private sector move into new areas on its own that is not always the case.

For that to happen, we'd need something more than a largely third-rate private sector.

[whatnext]

Oh look, Canada created more jobs than expected in April but unemployment goes up thanks to Justin. Anything to suppress workers' wages.

The odds of a June interest rate cut from the Bank of Canada appear to have fallen after the latest jobs report from Statistics Canada showed employment jumped by 90,000 last month.

The jobs gain far surpassed forecasters' expectations and marked the largest employment increase in more than a year.

The jobless rate held steady at 6.1 per cent last month.

The agency says the April employment gains were driven by part-time work..

....Population growth has outpaced job creation over the last year, which has pushed up the unemployment rate by a full percentage point.

Compared with a year ago, unemployment is up across all major demographic groups, with youth taking the largest hit, Statistics Canada said.

The data showed employment in April increased in professional, scientific and technical services, accommodation and food services, health care and social assistance as well as natural resources. ...

https://www.bnnbloomberg.ca/employme...-cut-1.2071400

[WarrenC12]

Originally Posted by whatnext

Oh look, Canada created more jobs than expected in April but unemployment goes up thanks to Justin. Anything to suppress workers' wages.

It's clear you don't understand how unemployment is calculated. And there was no change to the rate, not an increase.