I never gave any "advice." I was merely stating that taking all time historical highs in share price for oil companies (when those all time highs corresponded to all time highs in oil price) and comparing them to the share price today (when oil prices are no where near all time highs) provides nearly zero insight: save for the "captain obvious" insight that share prices of oil companies correlate to oil prices. In the same token, looking at annualized returns over a period for a particular industry against the S&P (which theoretically represents all industries, i.e. the entire economy) provides nearly no insight. It's like saying I'm 6 feet tall and my cousin is 5'4 - so what??? Are you providing the "captain obvious" evidence that diversification is a good thing??? I would argue that no competent investor needs that advice as diversification is a well understood concept. Differences in returns between one particular industry vs the entire economy over a time period (i.e. oil vs S&P or tech vs S&P over a time period) merely demonstrates differences in risk and provides evidence for diversification. What you appear to be doing is looking at returns over time in one industry against returns in the entire economy as some sort of evidence that one industry is a "loser" - and that would be a fallacy. Back in 1999 at the height of the tech bubble Apple was a dog and Dell was a star - and now Apple is the darling.
With oil prices plunging, what is next for Alberta?
- Thread starter CanineCowboy
- Start date
A balanced economy? Isn't Alberta the only province to have a refinery. Manufacturing of piping and fittings for the oil fields. Technical parks?
Oil- the future of oil is still there, but with climate change (or global warming) people have backed off from it, and reinvested in renewable energy (which isn't as practical as oil) and is harder to maintain facilities for renewables. The price of oil had to increase (due to the fact that oil is no longer being made) and eventually the world will reach its peak production of oil in the next 30 years. The US reached its peak production in the earyly 70s. But now the Americans are fracking the land and creating a big massive underground mess (environmental disaster) trying to get oil out of the ground (contaminating water supplies).
Oil is the cornerstone of transportation (cars=personal, trucks (semi)=hauling freight, train (diesel)=hauling freight, planes- rapid transport and passenger travel, boats- heavy cargo hauling. Renewables are only touching the car area, (I think there is some in transport trucks too), but trains and planes and boats where the majority of transport happens there is no good renewable option...there are hydrogen powered buses, but that needs infrastructure that is not set up completely to do long distance hauling of cargo...
So a diversified economy based on renewable energy and transportation... future technology
Governments at the Provincial, Federal and local areas have to sit down with Big, medium and small businesses and collaborate on a future plan to get Canada on track to a better future. Put a plan in for non-renewable resources for future use, (or trust fund that only interest on the interest can be used).
Lots of things that can be done, just have to think outside the box.
IN other words it has to be a plan that will transcend the politics of the day....
Oil- the future of oil is still there, but with climate change (or global warming) people have backed off from it, and reinvested in renewable energy (which isn't as practical as oil) and is harder to maintain facilities for renewables. The price of oil had to increase (due to the fact that oil is no longer being made) and eventually the world will reach its peak production of oil in the next 30 years. The US reached its peak production in the earyly 70s. But now the Americans are fracking the land and creating a big massive underground mess (environmental disaster) trying to get oil out of the ground (contaminating water supplies).
Oil is the cornerstone of transportation (cars=personal, trucks (semi)=hauling freight, train (diesel)=hauling freight, planes- rapid transport and passenger travel, boats- heavy cargo hauling. Renewables are only touching the car area, (I think there is some in transport trucks too), but trains and planes and boats where the majority of transport happens there is no good renewable option...there are hydrogen powered buses, but that needs infrastructure that is not set up completely to do long distance hauling of cargo...
So a diversified economy based on renewable energy and transportation... future technology
Governments at the Provincial, Federal and local areas have to sit down with Big, medium and small businesses and collaborate on a future plan to get Canada on track to a better future. Put a plan in for non-renewable resources for future use, (or trust fund that only interest on the interest can be used).
Lots of things that can be done, just have to think outside the box.
IN other words it has to be a plan that will transcend the politics of the day....
Personally, I do not buy into this semantic spin of now calling it the "energy sector". It has been their tactic in the last few years.
While correct on a technicality, it is not all the energy industry that is under the guillotine blade here, it is just the GHG-emitting carbon fuel producing sectors of it. Those energy industries that are not GHG emitters (hydroelectric, solar, wind, geothermal, nuclear), and going to be fine, and most of them are actually growing.
Other provinces do have refineries. Outside Alberta, I think the biggest refineries are in New Brunswick and Quebec (hence the Energy East proposal, which would have supplied NB refineries with Alberta oil).
BC does have a refinery in Burnaby, but it is not very big nor very modern. A lot of the local fuel supply in the Lower Mainland comes from refineries in Washington like Cherry Point. A lot of fuel in the Interior comes from Alberta refineries.
I still invest in oil but not in the oilsands. Why should someone invest $20.6 Billion (from my experience in the biz, it more likely $35 – 40 Billion) for roughly 250K barrels/day of bitumen crude when they can invest $3 Billion for 250K in a reasonably safe jurisdiction? Only Albertans seem to believe that their resources are a good deal. In so many ways vulnerable. They need heavy liquids production from natural gas to make bitumen transportable in expensive pipelines. Also, if you read the oil industry news not the mass media, you will see big new fields discovered all the time. Add in more potential in Iraq and other places. The biggest problem with oil is that it is just another form of energy (coal, natural gas, nuclear, sunlight, waves, wind and fusion in the future).
But in the end, it comes down to location, and quality of the resource. Alberta is not in a good location and you can see a lot of offshore drilling happening in some favourable climates finding big deposits. As for bitumen oil, if you invested in hydrocracking, etc., you could make it better. But constantly pumping in investment dollars with a long payback period is not attractive.
I used to invest in Alberta but these days, I don’t find the resources attractive and I also don’t care for Kenney and his antics. I’m sorry but the future doesn’t look good for Alberta.
But in the end, it comes down to location, and quality of the resource. Alberta is not in a good location and you can see a lot of offshore drilling happening in some favourable climates finding big deposits. As for bitumen oil, if you invested in hydrocracking, etc., you could make it better. But constantly pumping in investment dollars with a long payback period is not attractive.
I used to invest in Alberta but these days, I don’t find the resources attractive and I also don’t care for Kenney and his antics. I’m sorry but the future doesn’t look good for Alberta.
1 BILLION CDN COVID-19 PACKAGE “we are pulling out all the stops...” JT
31 BILLION GBR COVID-19 PACKAGE “just a start to soften the blow...”
31 BILLION GBR COVID-19 PACKAGE “just a start to soften the blow...”
Your statement is extremely short sighted. This will be the first quarterly decline in demand for oil in over a decade and it is all attributable to Covid-19
