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https://www.cbc.ca/news/business/us-iran-oil-sanctions-1.5106403

U.S. to end exemptions on Iranian oil sanctions for 5 nations, including China
Beyond the rather outrageous situation where the US is presuming to singlehandedly remake the terms of a multi-lateral deal between the UN Security Council and the EU, it seems probable that Japan and Korea, at least, will play along. Any feel for whether this will pump up Canadian oil prices appreciably?
 

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If WTI and WTS go up, and if the Canadian differential remains the same (as it might), then yes, Canadian oil prices will go up. The pertinent point is whether the differential stays the same, i.e. will the heavy oil refineries have to bid up their buying prices to keep their Cdn feedstock supplies? The issue for a heavy oil/dilbit refinery are the economics in trying to source other feedstock supplies versus Canadian dilbit.
 

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... Any feel for whether this will pump up Canadian oil prices appreciably?
Not likely. There may some short-term price effects, mostly due to uncertainty. Saudi Arabia is the one that really controls oil prices. SA and it's partners in OPEC conspired to keep oil prices high for quite a few years (or at least as high as the market would bear), but when Saudia Arabia started to lose too much market share they turned the taps on and brought the price way back down. In the meantime the US is bringing a lot of shale oil on stream. It's not cheap, but gives them the prospect of oil independence, and is cost-competitive with our oil sands product.
 

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US shale oil is way different than our dilbit, for different refineries. That said, US shale oil will serve to keep oil prices capped, and yes, SA can turn on the taps if price creeps too far. But if WTI and WTS do go up, then Cdn oil will most likely follow.
 

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Oil prices going up? Wow, Trudeau is saving the energy sector and saving Alberta!

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See, that sounds stupid right? Because Trudeau doesn't make oil prices go up. He also didn't make oil prices go down (and he didn't cause the massive new US oil production which made Canadian oil less desirable).
 

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Trudeau has put many road blocks up that impede the energy industry thus the billions of investment dollars left the country along with the many international companies that could not stomach our anti business government.

Oh...our oil is desired in Asia...all we can ship...now why can't we ship it?
If the USA needs a pipe its built in 2 years....in Canada nothing is built.

Trudeau is an anti oil pro Quebec ******* ...good riddance soon enough. American's and their oil industry is laughing at our hopelessness.

Oh....and the desirability of Alberta oil has no correlation with American production...it is correlated to transportation...as in a pipe in the ground.
 

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Who would be the Asian customers for Canadian oil ?

They are currently being supplied by other countries and if Canadian oil entered their market those countries would lower the price of their oil.

Increasingly, oil experts are questioning if a pipeline would make any difference at all. They question who the paying customers would be.
 

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Asians want reliable sources of oil. It's a reason China had been investing in Canadian oil, including buying up companies. Our oil is desired by the Asian heavyweights versus the Strait of Hormuz or the Suez. That has been known for decades....since the first OPEC embargoes.

It does not take a rocket scientist to see the instability in places like Iran, Iraq, Syria, Libya and even the Caucasus where Caspian region oil is highly vulnerable to seizure.

Added: You also need to understand that oil production declines by an average of 4-5% per year without continued re-investment. At a demand of 100 million barrels per day, enough capital must be spent every year to replace 4-5 million barrels of oil production capacity. That is hundreds of billions of dollars of investment each and every year.
 

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Who would be the Asian customers for Canadian oil ?

They are currently being supplied by other countries and if Canadian oil entered their market those countries would lower the price of their oil.

Increasingly, oil experts are questioning if a pipeline would make any difference at all. They question who the paying customers would be.
I believe it's the producers that are the paying customers. So your CNRLs, Husky's, etc. They pay to get their product to the coast, where the end customer arranges to get it loaded on ships. Either way, TMP has LOI's for the extra shipping capacity otherwise they wouldn't proceed with an expansion.
 

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Asians want reliable sources of oil. It's a reason China had been investing in Canadian oil, including buying up companies. Our oil is desired by the Asian heavyweights versus the Strait of Hormuz or the Suez. That has been known for decades....since the first OPEC embargoes.

It does not take a rocket scientist to see the instability in places like Iran, Iraq, Syria, Libya and even the Caucasus where Caspian region oil is highly vulnerable to seizure.

Added: You also need to understand that oil production declines by an average of 4-5% per year without continued re-investment. At a demand of 100 million barrels per day, enough capital must be spent every year to replace 4-5 million barrels of oil production capacity. That is hundreds of billions of dollars of investment each and every year.
There is also instability and danger in shipping through the straight of Malacca where 1/4 of the sea-shipped oil passes through. China is building a port and pipeline in Gwadar PAksitan to act as an alternative route and bypass that route, but Pakistan also comes with dangers.
 

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Oil is a very strategic resource. US and China obviously know this and have long term plans, and manipulate/control the world markets for their benefit

Does Canada have any long term strategy for oil or are we just being manipulated by those who do? Is it like our arctic sovereignty plan where we write glossy brochure policies but never actually execute anything? I found this but it sounds like we just leave it up to the market? Great

Does Canada have a strategic oil reserve like the US? I know we have a strategic reserve of maple syrup.

"As more easily accessible and lighter crude oils are depleted around the world, countries are turning increasingly to heavier and less accessible oil resources, which require more processing. As this shift in global production toward heavier crude continues, the carbon intensity of global oil supply will increase."

If instability/accessibility etc depletes the lighter crude oils around the world we could be in a good position long term by dumb luck. I'm afraid if push comes to shove though we have no plan/capability to protect our strategic resources. The arctic resources will be threatened first
 

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China is building a port and pipeline in Gwadar PAksitan to act as an alternative route and bypass that route, but Pakistan also comes with dangers.

the Silk Road rallway or a spur thereof would also route to gwadar

china has built/leased a deepwater superport near colombo sri lanka & reportedly owns a big chunk of the port of piraeus greece

note that recent Silk Road maps for the not-yet-built asia minor leg of the railway route through northern syria to the mediterranean coast. Not far south of the turkish border. Very close to the russian military base in northwest syria. That was what i had expected.

china is calling the global rail/ship buildout "One Belt One Road" but au fond it's the old Silk Road, the most ancient commercial trading route the world has ever known

archaeologists have found evidence in central asia of human traders leaving droppings (literally) that included parasites known only in china, not in central or west asia. These helped to confirm that early travellers on the silk road, perhaps 4000-5000 years ago, were traders transporting goods from faraway places, not just local shepherds trekking their flocks up & down local mountains
 

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Oil is a very strategic resource. US and China obviously know this and have long term plans, and manipulate/control the world markets for their benefit

Does Canada have any long term strategy for oil or are we just being manipulated by those who do? Is it like our arctic sovereignty plan where we write glossy brochure policies but never actually execute anything? I found this but it sounds like we just leave it up to the market? Great

Does Canada have a strategic oil reserve like the US? I know we have a strategic reserve of maple syrup.

"As more easily accessible and lighter crude oils are depleted around the world, countries are turning increasingly to heavier and less accessible oil resources, which require more processing. As this shift in global production toward heavier crude continues, the carbon intensity of global oil supply will increase."

If instability/accessibility etc depletes the lighter crude oils around the world we could be in a good position long term by dumb luck. I'm afraid if push comes to shove though we have no plan/capability to protect our strategic resources. The arctic resources will be threatened first
The US reserve isn't that big, realistically Canada and the US could be energy independant if it got that bad, and while a one month buffer of oil would be nice, it's not going to change much.
 

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It was noticeable that the US said that US and Saudi oil will be enough to replace embargoed Iranian oil. Canada isn't even mentioned.
 

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It was noticeable that the US said that US and Saudi oil will be enough to replace embargoed Iranian oil. Canada isn't even mentioned.
Geez Sags! Your are either trolling or who knows what? How can Canada get an extra 200-300kpd of oil to market to help supplement the lost Iranian volumes, e.g. circa May 1st, without additional pipeline capacity? Of course, we are not mentioned. We don't have the ability to get it there yet!
 

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We keep our strategic reserve under the ground near Ft McMurray...about 66,000 years worth.
Seems like a good plan. It's geographically secure compared to the arctic resources

Strategically and financially it makes perfect sense to leave it underground until/if we need it. Especially while there is cheaper/lighter/accessible glut available

US knows this.
 

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It was noticeable that the US said that US and Saudi oil will be enough to replace embargoed Iranian oil. Canada isn't even mentioned.

central east canada - quebec & much of ontario, as well as contiguous northeastern US states - are supplied by oil from the giant refinery/storage complex in montreal east.

altaRed recently posted that western canadian oil feeds 50% of that complex's consumption. The figure seems high to me - i would have thought more like 30-40% is mixed western canadian; but i bow to Red's knowledge.

how is the remaining 50% oil reaching montreal? by pipeline via northeastern US of A, with the principal pipe running from portand maine. And that pipeline's oil? it's coming from a variety of global feedstocks. The highest percentage destined for the portland pipe to montreal is said to be from nigeria. Saudi oil not far behind, was close to venezuela but with the current troubles in venezuela i don't know how much oil they are able to export.

western-based cmffers seem to have this fantasy that supertankers are sailing from the gulf of suez directly up the st-lawrence river to the port of montreal. However the fact is that they can't sail west of quebec city, the river is too shallow, even the st-lawrence Seaway silts up.

there are much smaller oil tankers with lighter draught that ply the waters between quebec city (has a tiny terminal with only one deepwater pier,) montreal & great lakes ports such as gary indiana, east chicago, duluth michigan.

this is why the US pipelines to montreal were built. Long time ago. Originals were likely standard oil of new jersey, aka Esso.

esso is now largely gone from the montreal refinery scene, just this morning i heard that parkland fuels out of calgary has recently bought a large part of Esso's former montreal-based fuel wholesale business, in addition to their successful acquisition of Ultramar a few years ago.

y'll can see the grand design here. Install upgraders at select alberta terminals, pipe oil to montreal east, supply gasolines, diesel, heating oil, aircraft fuel, propane, lubricants to a vast & densely-populated territory thousands of miles in diameter, extending as far south as massachusetts & ohio, as far north as north of the arctic circle ... epicentre montreal ... no immediate need to construct monster new pipeline through to st john NB ... canada should concentrate instead on transMountain to ship alberta oil via vancouver BC to asia.

it's interesting to see calgary's parkland fuels fitting in so well here in quebec. Cheerful, reliable, high quality products for vehicle drivers, building services, businesses, homeowners & farmers alike. No problems with the language. No problems with the culture.

makes the chronic alberta whiners in cmf forum look like caricatures from 6 years ago. Today they're totally out of touch. Luckily for alberta, the brand-new premier elected last week appears to have figured things out.


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