I wonder if Morneau can still put a 'stop payment' on that $4.5 billion cheque to Kinder Morgan?
A new report from a major French bank, one of the world's largest, says oil prices are heading for the tank.
The report from French financial giant BNP Paribas estimates that the market price of oil will have to fall dramatically in the next decade or two, or the industry risks losing its entire ground transport customer base.
“The oil industry has never before in its history faced the kind of threat that renewable electricity in tandem with electric vehicles poses to its business model,” wrote Mark Lewis, global head of sustainability research at the bank’s asset management division.
He described his estimates as a “death toll for (gasoline).”
Lewis’ analysis found that within a decade or two, oil will have to fall in price to around US$10 to US$20 per barrel to be competitive as a transport fuel. For comparison: Brent crude, the global benchmark for oil prices, has been trading at around US$58 per barrel recently.That's not good news for guys who've just bet the farm on bitumen pipelines or provinces have figure bitumen royalties mean they don't need a sales tax. Tough.
“If you can’t produce oil below $20 a barrel within 10 years, you’re going to have a big problem selling oil as a transportation fuel,” he said.
Justin, Jason - sorry boys but it sounds like there's a real constrictor coming your way and it might just squeeze the life out of your Athabasca tar pits. While you're waiting you might want to figure out how you're going to raise the nearly quarter trillion dollars needed to clean up those tailing ponds, the tar pits and those thousands of orphan wells. Just a suggestion.