| ENERGY: CIBC says Canadian oil sands will help fill growing global supply gap |
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(AlbertaIndex, September 14, Friday) --- Leading Canadian bank CIBC said Canada’s oil sands will help meet the world’s growing need for energy especially in light of declining supply from traditional oil suppliers. CIBC said the world’s leading oil-producing nations could see their export capacity drop by some 2.5 million barrels a day by the end of the decade. The report notes that OPEC and other key oil producers like Russia and Mexico are struggling not only to grow production, but to manage their own soaring rates of domestic oil consumption. This struggle will likely see their collective crude exports, which account for roughly 60 per cent of current world oil production, to fall by as much as seven per cent by 2010. CIBC said the outcome would be “significantly higher oil prices.” “One of the few areas where production can be expanded significantly is the Canadian oil sands, a vast reservoir of bitumen whose extraction and refining economics are becoming increasingly attractive as world oil prices continue to set new highs,” says Jeff Rubin, Chief Economist and Chief Strategist at CIBC World Markets. “Already at over a million barrels per day, production is slated to triple over the next decade and by 2020 could well be producing over 4 million barrels per day of synthetic crude, catapulting Canada to the front ranks of oil producers.” Mr Rubin states that within the next decade, the expansion of Canadian oil sands production will surpass deep water wells as the single largest source of new global supply. He notes that unlike in many other major oil-producing countries, virtually all of the increase in Canadian oil production will be slated for exports, likely in its entirety to the US market. Canada's domestic oil needs shrunk last year and are unlikely to grow significantly in the future as the Canadian economy becomes more and more subject to carbon abatement legislation and practice. This is in sharp contrast to the situation in the major oil-producing countries which are experiencing some of the highest jumps in oil demand in the world. Demand has grown at a soaring five per cent annual rate in Iran, Saudi Arabia and the United Arab Emirates over the last half-decade. Did you enjoy this article? Please share it!         |
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