Oil patch getting swagger back as crude hits 7 year high
Tuesday morning the West Texas Intermediate benchmark oil price crested the $85 U.S. mark, eventually hitting $85.90.
"It's even more remarkable on the Canadian side of things,"said energy analyst Jeremy McCrea of Raymond James LTD. "When we were last at these prices, when you look back to 2014, that's when the Canadian dollar was at par with the U.S. But now that we're sitting at a 78 cent dollar, the price that we're getting here in Canada is actually almost just right back to where we were in 2014."
McCrea said there are a multitude of reasons oil is spiking ranging from increased demand, tot unrest in some Middle East production zones, but said locally a shortage of workers is driving up prices as well.
"One of the reasons why we've seen prices move up is, there is a lot of demand for jobs here for guys to come and work," said McCrea." And what we're seeing right now, and reasons why prices are continuing to move up, is we just can't seem to find enough workers to come work on the rigs."
"The thing, though, with the energy patch, is there's a lot of guys looking at the sector saying, Can I have a career in oil and gas for 2030 years?" he added. "And I think there's a lot of doubt that that can happen, so that's scaring a lot of guys coming into the patch, which is leading to the staff shortages that you're seeing here today."
LONG TERM INVESTORS SHY AWAY
McCrea said while forecasts up to 2023 call for record oil demand, it is long term investors, the ones who put billions into mega projects with decades-long waits for returns, who are shying away from the oil and gas sector.
"At the ground level, like boots on the ground level, companies that are in the area of exploration or drilling are struggling to find enough people to fill the holes in their production teams," he said, "but at a at a higher level of investors and the stock market, people are saying, let's take the profits from this and not grow, but rather reap the benefits of the high prices without increasing staffing and production."
But the short-term staff shortages are driving a demand for workers in Alberta. While the latest figures from Statistics Canada show Alberta’s unemployment sitting above the national average at 7.3 per cent, and Calgary’s lagging even that at 8.2 per cent, staffing agencies say there are more jobs than workers looking to fill them.
"The unemployment numbers don't truly reflect what's happening in the market in a lot of ways, as the unemployment versus the active job seeker is two very different categories," said Cristina Schultz of About Staffing. "Right now, many individuals are not content to jump back into the job market, given the uncertainty and the instability and what that market brings."
Shultz said right now it’s a buyer’s market for those seeking employment, though she noted the storied lucrative oil patch pay packets are harder to find.
"When it comes to hiring and the way employers are going about attracting the right candidates, as we are certainly seeing an increase in average salaries of what we have been seeing as of late in the last few years, but I wouldn't say it is comparable, or as lucrative in that sense to what we have seen in the past, "said Schultz.
"Right now, with there being such a scarcity of those active job seekers, candidates have the luxury to be choosier in what they explore," she added. "So someone who once upon a time might have been open to exploring a three month or six month contract, they (now) have six vacancies at their disposal that they can choose who they want to work for what the nature of the role is the pay, the benefits, (and) the culture."
GOOD FOR PROVINCIAL FINANCES
The surge in oil prices is not just good news for job seekers, it is great news for the Alberta government, which in 2020 budgeted for oil to hover around the $46 mark.
"Each dollar increase per barrel is about four to $500 million to the government's bottom line," said University of Calgary economist Trevor Tombe. “So we're looking here at 80 plus dollars per barrel. That is tens of dollars per barrel more than where we previously thought oil was going to be. So this is a dramatic turnaround in provincial finances.”
Trevor Tombe, University of Calgary economist
Now, with an election just over a year away, and a budget set for February 24th, Alberta’s finance minister is robo-calling Albertans inviting them to a telephone town hall meeting to ask how they want to spend the money.
There are two town hall meetings, one for northern Alberta residents on Tuesday, January 18 at 6:30 p.m. to 8:00 p.m.
The second for those living in southern Alberta on Wednesday, January 19 at 6:30 p.m. to 8:00 p.m.
Albertans can also listen and ask questions online.
Calgary Top Stories
CTVNews.ca Top Stories
By now it's as predictable as the calls for thoughts and prayers: A mass shooting leaves many dead, and wild conspiracy theories and misinformation about the carnage soon follow. Within hours of Tuesday's school shooting in Uvalde, Texas, another rash began as internet users spread baseless claims about the man named as the gunman and his possible motives.
Tens of thousands of Ontario residents are facing another day without power as restoration efforts continue following last weekend's vicious storm.
A fire in the neonatal unit of a hospital in Senegal has killed 11 newborns, President Macky Sall said. Only three infants could be saved.
Conservative Party of Canada leadership hopefuls Scott Aitchison, Roman Baber, Patrick Brown, Jean Charest, Leslyn Lewis, and Pierre Poilievre squared off in the second official party debate on Wednesday night in Laval, Que.
Canada is committing an extra $1 million to help the international community investigate sex crimes by Russian troops in Ukraine. Foreign Affairs Minister Mélanie Joly said Canada would give the extra funds to the International Criminal Court to help it investigate sexual violence toward women, and also crimes against children.
Frustrated onlookers urged police officers to charge into the Texas elementary school where a gunman's rampage killed 19 children and two teachers, witnesses said Wednesday, as investigators worked to track the massacre that lasted upwards of 40 minutes and ended when the 18-year-old shooter was killed by a U.S. Border Patrol team.
Families are sharing photos and stories of their loved ones, who lost their lives in a mass shooting in Texas that killed at least 19 children and two adults on Tuesday afternoon.
Several parts of the country, including British Columbia and Canada's Maritime provinces, are likely to see wetter-than-normal conditions this summer, according to AccuWeather's annual summer forecast.
The Public Health Agency of Canada says it has now confirmed a total of 16 cases of monkeypox in the country, all in Quebec.
If you visit downtown Edmonton in the next 11 days, you might see some strange and unusual sights. Art installations and musical performances are popping up throughout the area as part of Downtown Spark.
Even though they cheer for opposite teams, a proposal by a Flames fan at Game 4 of the Battle of Alberta received a resounding "yes" from the Oilers-loving bride to be.
The body of a missing canoer has been located in northeast Alberta.
The decision to focus on urgent and emergency health care to avert long waits played a key role in B.C.’s current primary care crisis, and the costlier care is compounding the problem.
A social media video that captures the moment a man gets Tasered by a Vancouver police officer is prompting calls for more training for police going out mental health calls.
A judge has refused to grant a B.C. cannabis company an injunction against a man who used a list of email addresses the company accidentally sent to all shareholders against it.
As the inquiry into Nova Scotia’s mass shooting moves its public proceedings to Truro, many of the family members affected by the tragedy and their lawyers are boycotting the proceedings over the next week.
Former Chief Anchor Steve Murphy offers a timely perspective on the Mass Casualty Commission and the difference 30 years after the Westray inquiry.
Speaking off-script at an event in Halifax Wednesday morning, Canada's Minister of Public Safety said he was gutted by the latest mass shooting south of the border - the 27th in a school this year alone.
Authorities are investigating Wednesday after the body of a porpoise was discovered on a beach near Victoria.
Victoria police say three men were arrested after a random bear spray attack occurred on Monday.
A British Columbia company that was once at the forefront of the booming plant-based meats industry is shuttering stores and production plants as it struggles to survive.
Was your home damaged by the Ontario storm? Insurance companies say payouts could take weeks to process
The insurance industry says it could take up to six weeks to get an idea of how many hundreds of millions of dollars in pay outs will be required from the weekend storm that brought death and destruction to Ontario and Quebec, but that early estimates are substantial.
Police have released new video of a recent incident in which a vehicle was caught doing doughnuts and speeding along the shoulder of busy Ontario roadways.
People all across Ontario are getting creative when it comes to netting a secondary income, otherwise known as a “side hustle,” and many are turning to secondhand economies thriving on online platforms.
Quebec's public health department is set to give its first press conference on the growing monkeypox outbreak as the province recorded its 16th confirmed case Wednesday.
Quebec politicians were not pleased with the federal Liberals' comments on Bill 96 and Bill 21, firing back with a slew of protests and even raising sovereignty as the solution.
Several of the six aspiring Conservative leaders expressed their opposition to Bill 96 during a French-language debate in Laval on Wednesday night, but others shied away from the opportunity to express their views on the issue.
NEW THIS MORNING
NEW THIS MORNING | Here's what you need to know about the storm cleanup in Ottawa today
Hydro Ottawa is hoping to energize hydro lines in the Merivale Road area today, as the cleanup continues following last Saturday's devastating storm.
The president of Hydro Ottawa says "with a little bit of luck" power will be restored along the Merivale Road area on Thursday, bringing power to another 15,000 to 20,000 customers still in the dark following Saturday's storm.
The Ottawa Catholic School Board says all schools with power will be open on Thursday, but 14 schools without power will remain closed.
New details are emerging about the tragic incident that killed 27-year-old Shelby Humble-Neale on Saturday.
Waterloo regional police say evidence of gunfire found in McLennan Park in Kitchener is connected to another shooting incident in the nearby area of Windflower Drive and Windflower Crescent.
Two 29-year-old men have been seriously injured following a collision in Baden, Ont., with one needing to be airlifted to a hospital outside the region.
The Prime Minister toured the Vaccine and Infectious Disease Organization, which is working to develop a COVID-19 vaccine.
Saskatoon Police Service says that the use and presence of potent new synthetic opioids known as nitazenes are difficult to track and monitor.
A 48-year-old semi-truck driver was killed in in a rollover near Meadow Lake on Tuesday.
Sault Ste. Marie city council is asking staff to prepare a report on group homes. This comes after Ward 1 Coun. Paul Christian brought forward concerns this week about two such homes.
There are currently a dozen statues at the Grotto of Our Lady of Lourdes property, and all are from the 1950s.
It’s a sign that summer is on the horizon. Farmers’ markets are opening in cities and towns across the north.
A new report out of the Canadian Institute for Health Information (CIHI) has found that most Manitobans have positive experiences with the health-care system in hospitals.
The Manitoba Government could turn to the military for help as it struggles with staffing shortages, overcrowding, and in some cases, temporary closures of emergency rooms.
The Manitoba government is hinting it may allow more alcohol sales through private channels to boost customer convenience.
'All it takes is one': Sask. RCMP partner with Washington police to publicize disappearance of Mekayla Bali
Saskatchewan RCMP and the Washington State Patrol announced a collaboration of efforts to locate Mekayla Bali, who was 16-years-old when she was last on April 12, 2016 in Yorkton.
A new art exhibit at the George Bothwell Library is hoping to examine and remove the feeling of shame associated with people who are deaf and hard of hearing.
For those looking to hop the border into Manitoba for their camping seasons, it started off on the wrong foot for Duck Mountain Provincial Park.