Quote:
Originally Posted by Bunk
WTI at $66 and rising, seems fairly significant. Is this price escalation going to sustain? Admittedly, my knowledge of oil markets is somewhere between nothing and very little.
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To me it depends on two things:
1. what OPEC does in response. But right now they seem pretty supportive of keeping prices in this neighborhood so maybe they don't jack up production.
2. how quickly the world economy rebounds from Covid. A quicker than expected recovery will put a squeeze on supply which would certainly support current pricing levels (or even raise them).
Bigger question for me is can Canada take advantage of these prices? Industry has been in the toilet for going on 7 years now, I don't know how quickly we can respond. The service side has been absolutely gutted. Even if Operators wanted to ramp up (drilling etc.) there probably isn't the equipment or manpower to do so. Oilsands would be better able to take advantage as their infrastructure is still in place. Taking my employer as an example. This winter was really good for us activity wise but we were at about 25% of our activity levels compared to when I started here 10 years ago. And it was an absolute struggle to execute this winter as we were very constrained on personnel and equipment.