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Calgary & Alberta Economy

By recent market activity and most forecasts, the price of oil and natural gas is headed in an upward trajectory. Whether we see the price levels of 7-8 years ago is anyone's guess. One thing is for sure, the pull back of investment in fossil fuel expansion is going to limit supply in Canada, and global demand for oil and gas is not expected to diminish until 2030-35, and then only gradually. Many experts are saying this lack of investment will also hurt U.S shale oil and gas expansion so we may not be faced with that competition as we have been for the last several years.
Unless we see an energy crisis (some are predicting this), it is unlikely we will see any new mega projects. The process for these takes 3-5 years or more to come on line, after all of the approvals are obtained. It was projects like these that fueled job growth in Calgary and demand for office space. We are likely to see increasing demand for Canadian oil & gas and supply will have to come from existing sources. Fortunately, our pipeline woes will be solved somewhat by the expansions of Line 3 and the TMX. The future looks very bright for Alberta from a growth standpoint. However, without those lost jobs coming back in Calgary and new office towers going up, it may not feel like a 'economic boom'. 🤔
 
My hope is that the higher prices at least stabilizes the industry enough that the layoffs come to a halt and companies can starting spending a bit. Let things things ride out on cruise control for a bit. I agree with others though, we probably won't see a boom, but more of an upturn and some stability after 7 years of instability. No mega projects, but enough spending activity to juice things up.
 
I had no idea that ‘The Last of Us’ was the largest film production in Canadian history. It’s going to generate $200 million for the Alberta economy…

Anyway, it’s filming across the Beltline today, and one of the sites is a block from my place.

31EEBECA-AE02-4C5E-9EBB-8A1DCD0AFF14.jpeg
 
www.cnn.com

Energy crisis will set off social unrest, private-equity billionaire warns

Blackstone CEO Stephen Schwarzman warned Tuesday that high energy prices will likely set off social unrest around the world.
www.cnn.com www.cnn.com

Pump prices are getting a lot of attention on both sides of the border. Interesting that this CEO thinks it could lead to civil unrest. Gas prices will lead to civil unrest?... not the spiking cost of food or housing ... but gas!
Anyone remember what we were paying for gas back in 2013/4 when a barrel was well over $100. Seems to me that we were paying the same then as we are now at $85 per barrel. I know taxes (i,e carbon) are higher now so that is part of it.
 
MichaelS said:
I love the Streetview time machine aspect. Not a full report, but you can get snapshots in time. The Husky station on Bow Trail, just west of 37th Street:
118.9/L in October 2012
113.9/L in August 2014
Click to expand...
Wow .. so we were under $1.20/L when oil was well over $100 per barrel and today we are over $1.30/L with oil at $85 per barrel. If and when oil goes back over $100, then we are probably talking close to $2.00/L at the pump. Then you are going to see a lot more chatter (more like screaming) about increasing oil production to bring down the prices. Not sure how we are going to accomplish that in North America in the short to medium term with both Canadian and U.S. governments and investors, doing everything they can to discourage new fossil fuel projects. That means the Middle East and Russia will be the beneficiaries. 😞
 
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JonnyCanuck said:
Wow .. so we were under $1.20/L when oil was well over $100 per barrel and today we are over $1.30/L with oil at $85 per barrel. If and when oil goes back over $100, then we are probably talking close to $2.00/L at the pump. Then you are going to see a lot more chatter (more like screaming) about increasing oil production to bring down the prices. Not sure how we are going to accomplish that in North America in the short to medium term with both Canadian and U.S. governments and investors, doing everything they can to discourage new fossil fuel projects. That means the Middle East and Russia will be the beneficiaries. 😞
Click to expand...
Lets adjust oil prices into C$ and see the change. Oil prices last Friday, in Canadian dollars, were only higher on average in 2013 ($101.89 today vs $104.26 in 2013). Add to that that the WCS differential was way higher then ($18.59 today vs $24.15 in 2013), and you end up with a higher WCS price ($82.30 today vs $80.11 in 2013).
1635291561390.png


I added a time series for gasoline prices, and TBH they don't seem out of line, especially considering we have both high prices and the rejoining of Alberta's petroleum markets to content with, plus 12.4,12.5 cents a litre more in provincial and federal taxes.
1635292912889.png

Here is the gas price series for good measure:
1635296108909.png
 

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Thought I'd dump some more. Because I don't think I'd really internalized how much better prices were.

The first isn't anything fancy, just shows Alberta's oil production growing over time.
1635294497485.png


Second is a kit bash: how much money 'we've' made per month. Assuming the market price for WCS is the average price for non-conventional, and the WTI price is the price for conventional.
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darwink said:
Lets adjust oil prices into C$ and see the change. Oil prices last Friday, in Canadian dollars, were only higher on average in 2013 ($101.89 today vs $104.26 in 2013). Add to that that the WCS differential was way higher then ($18.59 today vs $24.15 in 2013), and you end up with a higher WCS price ($82.30 today vs $80.11 in 2013).
View attachment 358496

I added a time series for gasoline prices, and TBH they don't seem out of line, especially considering we have both high prices and the rejoining of Alberta's petroleum markets to content with, plus 12.4,12.5 cents a litre more in provincial and federal taxes.
View attachment 358498
Here is the gas price series for good measure:
View attachment 358503
Click to expand...
I love a good data supported argument. Thanks for this
!
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UrbanWarrior said:
I had no idea that ‘The Last of Us’ was the largest film production in Canadian history. It’s going to generate $200 million for the Alberta economy…

Anyway, it’s filming across the Beltline today, and one of the sites is a block from my place.

View attachment 357667
Click to expand...
Do all the businesses on the street have to close when they shoot on a street for multiple days like that? Would be tough for some of the places that barely squeaked by the last few years.
 
Mountain Man said:
Do all the businesses on the street have to close when they shoot on a street for multiple days like that? Would be tough for some of the places that barely squeaked by the last few years.
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I'm pretty sure production will work something out with the businesses. When I lived in DC there was some sort of production happening in Dupont Circle that shut down access to this bakery that I liked going to. I asked the staff afterwards and they said the business gets compensated for loss of business
 
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