EDMONTON – Premier Jason Kenney says a global oil glut means Alberta’s main industry will be dealing with low prices for a year or longer after the COVID-19 pandemic abates.
Kenney says reduced demand for oil and gas during the pandemic coupled with a destructive price war between Saudi Arabia and Russia has left the world awash in oil.
He says supplies are so swamped, holding tanks are at the brim and tankers on the U.S. Gulf Coast can’t unload.
West Texas Intermediate, the benchmark price for North American oil, is hovering around $US15 a barrel, while Alberta had banked on it being US$58 a barrel this fiscal year.
Alberta’s budget deficit was expected to be $7 billion before the COVID crisis.
Kenney has said it will now likely be closer to $20 billion.