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
Students trapped inside a classroom with a gunman repeatedly called 911 during this week's attack on a Texas elementary school, including one who pleaded, 'Please send the police now,' as nearly 20 officers waited in the hallway for more than 45 minutes, authorities said Friday.
Speakers at the National Rifle Association annual meeting assailed a Chicago gun ban that doesn't exist, ignored security upgrades at the Texas school where children were slaughtered and roundly distorted national gun and crime statistics as they pushed back against any tightening of gun laws.
Fifty-eight-year-old Vivian Ketchum is set to receive her high school diploma at a graduation ceremony at the University of Winnipeg next month. It is a moment that is decades in the making.
The World Economic Forum’s annual meeting in Davos was met with justifiable criticisms and unfounded conspiracy theories.
An 11-year-old survivor of the Robb Elementary School massacre in Uvalde, Texas, feared the gunman would come back for her so she smeared herself in her friend's blood and played dead.
A new report says Ottawa, Vancouver and Toronto rank among the top 20 cities around the world when it comes to work-life balance.
Fragments of a comet broken nearly 30 years ago could potentially light up the night sky Monday as experts predict an 'all or nothing' spectacle.
The Supreme Court of Canada’s ruling allowing the Quebec City mosque shooter to be eligible for parole after 25 years is raising concern for more than a dozen similar cases.
Transport Minister Omar Alghabra says the federal government is working with groups on the ground to resolve air travel 'bottlenecks' in time for a busy summer.
A hotly-controversial decision on whether or not to freeze base funding for police in Edmonton was delayed Friday as fallout from a dispute between the mayor and the provincial justice minister continued to rattle political circles.
A 19-year-old man is in police custody after a shooting near Rogers Place after an Edmonton Oilers viewing party ended Thursday evening.
A shelter many expected to remain open until the end of June in Wetaskiwin, Alta., will close a month early.
A B.C. mom with a rare, debilitating illness has spent years trying to get the help she needs. Now she's considering medical assistance in dying.
The number of COVID-19 patients in B.C. hospitals hit its lowest point in more than a month this week, and the decline was driven largely by regions outside the Lower Mainland.
Researchers working in partnership with UBC believe an eco-friendly material could help solve the world’s plastic pollution problem.
A Cape Breton father is warning the public of the dangers in the area he lives after his teenager son fell nearly 40 feet over a cliff in Glace Bay.
A lawyer for families of victims killed in the Nova Scotia mass shooting says an 18-hour delay in finding five bodies of those murdered is a sign of "deficient" policing.
The lawyer who represented a man who murdered three RCMP officers nearly eight years ago in Moncton, N.B., said a decision made by the Supreme Court of Canada Friday may potentially change his sentence.
B.C. speedboat driver arrested with 650kg of meth 'feared for his family's safety,' he told U.S. investigators
New details are emerging after a 51-year-old Alberta man was arrested aboard a speedboat that U.S. authorities say was carrying 650 kilograms of methamphetamine between Washington state and British Columbia.
The emergency department at Port McNeill Hospital unexpectedly shut down on Friday evening due to a staffing shortage.
At least one building was destroyed Friday afternoon as firefighters rushed to a large fire at the vacant Pioneer Square Mall in Mill Bay, B.C.
WATCH | New video appears to show man carrying air rifle on Toronto streets before being killed by police
A man shot dead by police officers near a Toronto elementary school on Thursday afternoon appears to have been captured on home security footage carrying an air rifle moments before the incident.
A 21-year-old Toronto man is facing a slew of charges following a suspected hate-motivated incident at a Jewish school in North York.
Toronto Pearson International is warning travellers and Mississauga residents they may notice unusual activity at the airport this weekend.
Is it unconstitutional to make someone pay to get a legal document translated into French? One of Montreal's top lawyers thinks so, and pointed out two other things from Bill 96 that he thinks the courts would most easily find fault with.
Canada's highest court has ruled that Alexandre Bissonnette, who murdered six people at the Quebec City mosque in 2017, will be eligible for parole after 25 years.
Quebec says it is ready to vaccinate people who have come into close contact with monkeypox as soon as Friday.
As of Friday evening, 26,000 Hydro Ottawa customers remain without power in all neighbourhoods of the city.
Approximately 25,000 people will take part in Tamarack Ottawa Race Weekend on Saturday and Sunday.
Ottawa Bylaw says the "mama and her 4 kittens" were abandoned outside the PetSmart on Innes Road sometime between 6 a.m. and 8 a.m. Friday.
A man, who was a referee at high school volleyball games in Guelph for more than 30 years, is facing sex assault-related charges.
The Region of Waterloo says there's a high safety risk at a Kitchener encampment and they are working with residents to prepare them for their eventual move.
Two low-cost airlines are butting heads over an agreement at the Region of Waterloo International Airport. Swoop wants to offer flights but the airport already has an exclusivity deal with rival Flair Airlines
Barrett Ross says his dog Indy suffered a punctured bowel, lost a tooth and had his stomach injured when he was attacked by three other dogs.
The Saskatoon Tribal Council's (STC) temporary downtown shelter has been granted an extension to operate at its present location until April 2023 — but Tribal Chief Mark Arcand hopes to relocate well before then.
A pedestrian injured by a vehicle in Prince Albert has died.
On Friday, there was a walk in Sudbury to remember the remains of 215 residential schoolchildren found in Kamloops, B.C., a year ago May 27.
Staff at the new Sault Metis Centre are getting set for the grand opening Saturday.
Members of the NDP, Liberal and Green parties attended a meet and greet at Nipissing University's Student Centre on Friday afternoon.
Pembina Trails School Division is confirming to CTV News that a group of students found a body during community cleanup at Ècole South Pointe School.
Winnipeg police are telling people to find an alternate route this afternoon as they are investigating a fatal crash near the St. Boniface Industrial Park.
'It's one way to be creative': Winnipeg student wants to be a bartender when older; school doesn't like comment in yearbook
Bartender. That is what one Grade 4 student said for the yearbook when asked what he wanted to be when he grows up, an answer the school is asking him to change.
Cyber security attacks happen every day, and as Regina Public Schools division discovered this week, no one is safe.
'Very upset': Senior housing residents plead for Sask. Housing Corporation to rebuild after winter fire
Former residents of a Carievale seniors housing complex want the Saskatchewan Housing Corporation (SHC) to reconsider its decision to demolish the home.
Premiers from western Canada met to discuss healthcare in their first face-to-face meeting in more than two years in Regina on Friday at the 2022 Western Premiers' Conference.