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Calgary & Alberta Economy

Massive hit to the economy today, Cenovus and Suncor have both lost a massive amount of their value and trading was halted in the markets just a few minutes into trading. This could be very bad for Alberta...
I expect the non-integrated players like Cenovus to be bought up. In the integrated players can get financing that is, or have cash sitting no their balance sheet
 
There have not been any posts in this thread for a couple of weeks, for obvious reasons. So here is a summary. Nuff said!?

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Heard today that an estimate of unemployment in Canmore Banff is now 85% - all tourist services down to skeleton staff only. The number does sound pretty high to me, considering we're seeing 25% average projected country wide--I could see them getting to 45%. Perhaps it is counting all the winter seasonal staff who were let go and haven't moved away yet.
 
Heard today that an estimate of unemployment in Canmore Banff is now 85% - all tourist services down to skeleton staff only. The number does sound pretty high to me, considering we're seeing 25% average projected country wide--I could see them getting to 45%. Perhaps it is counting all the winter seasonal staff who were let go and haven't moved away yet.
It seems high at first glance, but given that Banff's workforce is almost entirely tourism related I guess it could be possible.
 
The irony in this whole thing is it took a single microscopic bug to destroy the entire global economy. You would think it would likely have been nuclear warfare or something bigger. At least we're not alone, misery loves company, the whole world is going to suffer alongside us.
 
Aside from all the dumb things coming out of this mans mouth, I can't entirely hate him, he's always seems to indirectly bring our province back from the dead!
https://ca.finance.yahoo.com/news/trump-says-saudis-russia-cut-145742865.html
Let's see if OPEC and Russia get a deal done.
A production cut along with Keystone Xl and hopefully a somewhat smooth, quite construction of the TransMountain in the midst of this pandemic could be enough to give our province a strong foothold heading into a global recession.
 
Aside from all the dumb things coming out of this mans mouth, I can't entirely hate him, he's always seems to indirectly bring our province back from the dead!
https://ca.finance.yahoo.com/news/trump-says-saudis-russia-cut-145742865.html
Let's see if OPEC and Russia get a deal done.
A production cut along with Keystone Xl and hopefully a somewhat smooth, quite construction of the TransMountain in the midst of this pandemic could be enough to give our province a strong foothold heading into a global recession.
Trump will take credit for anything and everything. If the oil price issue does get resolved, it will be because production at those prices is just not sustainable. There already is a glut of supply to the point where production will have to slow. Consumption is way down and will continue until the economy gets back to normal.
 
Trump will take credit for anything and everything. If the oil price issue does get resolved, it will be because production at those prices is just not sustainable. There already is a glut of supply to the point where production will have to slow. Consumption is way down and will continue until the economy gets back to normal.
I’m not denying trump is big narcissist but he did get on a phone call with Putin to address the situation. Some are saying Putin played him right in and we don’t know what exactly the US will offer to Russia but it most likely will be a relief of some of the sanctions. Whatever the situation is, it gives Alberta another day to survive, oil prices likely won’t rocket over 50 anytime soon but it’ll help our producers live to see another day and hopefully avoid catastrophic unemployment levels.
 
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Trump likes to make shit up so it remains to be seen whether that call was made to either Russia or Saudi Arabia. If anything was discussed, there was no urgency. The planned meeting today between Russia and Saudi Arabia was called off until the end of the week. The oil market was shaken again.

For sure, the U.S. needs to broker a deal between those two countries. However Trump is the wrong guy to do it. Other than perhaps real estate transactions, his 'great' deal making skills are clearly exaggerated.
 
The problem isn't just Russia and Saudi though - it is the USA and to some extent Canada too. Canada grew oil production by a lot, the USA grew even more and even faster because credit was cheap and everyone could make their money if the developers were on a growth path (even if never making any profits, if their velocity was high enough it would look like they were going to make money when they stopped growing if you evaluated their books in a certain way). Saudi was tired of having the burden of keeping oil where it was (a not great price).

I don't think there is any mechanism that will bring the USA into the production cuts tent, except for natural decline as less new wells get drilled.
 

This popped up in my news feed today, I was pretty shocked to see Calgary in the #3 spot for cranes among North American cities. Wouldn't be surprised to see us in the #2 spot in a few years once oil prices recover and we have 3 shiny new pipelines in the ground.
 

This popped up in my news feed today, I was pretty shocked to see Calgary in the #3 spot for cranes among North American cities. Wouldn't be surprised to see us in the #2 spot in a few years once oil prices recover and we have 3 shiny new pipelines in the ground.
I would be quite surprised to see more cranes.

Pipelines (and their benefit of limited term construction management jobs + small amount of maintenance jobs + reduced transportation costs) =/= anywhere near enough head office jobs that would make a dent in the 25+% vacancy we have already (let alone the ongoing global collapse of many sectors, including energy). Whatever new demand is eventually created for office space will be dwarfed by the collapse of other users. Most of Calgary's workforce growth potential remains in other sectors once the immediate crisis is resolved, most of which need no office product we don't already have. So no cranes there.

Unfortunately, non-energy job growth will be hampered but a sole-focused provincial government desperate to support a single industry over all others. Removing all tax credits for tech and others certainly didn't help non-energy job growth, but combining it with a program to deeply slashing public sector drivers such as municipalities, universities, hospitals and schools and the related employment will not be good for the local housing growth or construction. Calgary and Edmonton - having a disproportional amount of municipal, university, hospital and school projects on account of being Alberta's only major cities - are bearing the brunt on these cuts, while simultaneously their potential is being handicapped by removing the attractive policies for alternative economic drivers that would otherwise concentrate in our largest cities.

Our population and household growth is driven by both international migration and local growth. I don't know what the crisis will mean for those numbers, but surely the international growth driver will be negatively impacted for a while. Again, this means less potential for new population, therefore less new development.

I hope someone has a more positive assessment out there, I would be happy to hear it.... but I don't see a good way out of this one for Calgary or Edmonton with (1) a collapsed global economy, including oil and gas demand (2) a provincial government actively working against many of the drivers of urban growth, through cutting investment and job potential in alternative sectors.
 
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I would be quite surprised to see more cranes.

Pipelines (and their benefit of limited term construction management jobs + small amount of maintenance jobs + reduced transportation costs) =/= anywhere near enough head office jobs that would make a dent in the 25+% vacancy we have already (let alone the ongoing global collapse of many sectors, including energy). Whatever new demand is eventually created for office space will be dwarfed by the collapse of other users. Most of Calgary's workforce growth potential remains in other sectors once the immediate crisis is resolved, most of which need no office product we don't already have. So no cranes there.

Unfortunately, non-energy job growth will be hampered but a sole-focused provincial government desperate to support a single industry over all others. Removing all tax credits for tech and others certainly didn't help non-energy job growth, but combining it with a happy program of deeply slashing public sector drivers such as municipalities, universities, hospitals and schools and the related employment will not be good for the local housing growth or construction. Calgary and Edmonton - having a disproportional amount of municipal, university, hospital and school projects on account of being Alberta's only major cities - are bearing the brunt on these cuts, while simultaneously their potential is being handicapped by removing the attractive policies for alternative economic drivers that would otherwise concentrate in our largest cities.

Our population and household growth is driven by both international migration and local growth. I don't know what the crisis will mean for those numbers, but surely the international growth driver will be negatively impacted for a while. Again, this means less potential for new population, therefore less new development.

I hope someone has a more positive assessment out there, I would be happy to hear it.... but I don't see a good way out of this one for Calgary or Edmonton with (1) a collapsed global economy, including oil and gas demand (2) a provincial government actively working against many of the drivers of urban growth, through cutting investment and job potential in alternative sectors.
I was thinking more along the lines of more cranes for residential projects, i don't think we'll need more office space for a while. But i can see O&G companies filling those towers up again, more pipeline capacity means more projects and more drilling which means more engineers, geologists, etc working in Calgary. There is currently no growth in Canadian oil and gas because the pipelines are full and the price is low. If both of those things change i expect another boom in ~3 years, but i'm an optimist.
 

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