Saudis’ Real Target May Be Canadian Oil Sands



Comments (3)

  1. Jill says:

    Not very technical, but an effective article nonetheless, Tim. However, I’d like to see more commentators discuss the fact that, while Saudi Aramco does have low operating costs, it operates as a defacto Saudi government department, and it’s profits are used to fund the kingdom’s operating budget. In short, the Saudis need $100 per barrel oil to avoid deficit spending and the erosion of the state. Without $100 oil, the Saudis must spend savings and borrow to finance public spending. Conversely, while new oil sands projects do need $80+ per barrel oil to be feasible, most existing operations will survive $55 oil. Furthermore, the Saudi Riyal is pegged to the USD while the Canadian dollar floats, which means that Canadian oil production costs are denominated in CAD, while sales of oil are in USD, which adds a small competitive advantage to Canadian producers.

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  2. Jawaid manzoor says:

    Alberta and taxes work together and, yes, oil sands is no-goer now or will be, let alone the pollution.
    Governments look for taxes to mis-spend. consumers look for savings, and have the drawn benefit through lower prices, including more cars sold for auto industry emptying the inventories. Saudis don’t do anything without consulting US Oil barons, who may well the first to pile up their stock at the back of current prices while long before will raise prices. This up and down has been there between oil and auto industry while to keep in mind that new avenues of energy are opening to which auto industry is itself a contributor…

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  3. Kevin Beck says:

    One thing that was missing from the article (and I ask this with slight sarcasm) is: Where are we going to get our roofing tar from, if not the Canadian Tar Sands?

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