To be a player in the oil game, it appears wise to either hedge one’s bets or not play at all.
If Canada was getting too big for its big-oil britches, Saudi Arabia took care of that, proving who truly holds all the cards in the global oil market.
Despite a recent bump, oil prices are expected to stay low until summer when demand picks up. Perhaps by then the energy sector in North America will return to what it was and Canadians can resume their patriotic duty of paying exorbitant prices at the gas pump.
One lesson, or reminder, picked up locally from this slump is the importance of diversification. While there’s clearly big money to be earned supporting the oil sector, in the end, the industry is like any other – potentially unstable and, ultimately, out of our control.
The federal and B.C. governments have invested a lot of effort and tax dollars into supporting oil and gas extraction as though they’re the only thing keeping the nation afloat.
Oh, wait, maybe they are. And that’s our fault. And now we’re seeing the apparent risk of this.
We’ve all heard stories about the economic prospects of a “green economy” and how new jobs could be created, building and supporting cleaner energy options and related infrastructure. However, there still appears to be little appetite to make that shift.
Incidentally, it was recently reported the Canadian wind-energy sector experienced a record-breaking year in 2014, with capacity to power up to three million homes annually. And we’re not talking about a lot of wind farms here.
It’s unlikely the wind industry will supplant the oil industry as an energy resource or mass provider of employment.
The point is, it is folly to rely entirely on oil. Investing more in alternatives would help further diversification and establish greater energy independence. The nation could stand to gain from both.
