Americas News
Worst Quarter Ahead for Oil, Says Former Shell Head, But Canada Remains Optimistic
John Hofmeister, former President of Royal Dutch Shell said Tuesday that the worst may still be coming for the beleaguered oil industry, CNBC reports.
"I think the first quarter of next year is going to be probably the roughest quarter that the oil and gas industry has seen really in a long time," Hofmeister told the news service.
Hofmeister sees oil recovering only once producers like Saudi Arabia reign in production in line with slower global demand.
He added that such events could then cause a price spike, especially given that industry cost-cutting during the current downturn may leave the oil sector unprepared for higher prices.
At the same time, Joe Ceci, Finance Minister of the oil-rich Canadian province of Alberta Tuesday said he sees a possible rebound in crude prices currently setting up, the country's Global News reported.
"The situation with commodities is dire," Ceci was quoted as saying at a gathering of Canadian provincial leaders, but then adding that "people think it might be the bottom of the trough and that things are going to be building and getting better going forward."
Such a rebound would be welcomed by Canadian oil producers, especially in the oil sands, where prices are understood to have been running at just under $20 per barrel so far in December.
Patricia Mohr, vice-president and commodity markets specialist at Bank of Nova Scotia, was quoted as calling the situation for oil sands producers "really quite grim."
"I think the competition in the oil markets is actually heating up. It's probably going to be very intense in early 2016," Mohr said.
In November, Ship & Bunker reported that problems being faced by Canada's oil sands producers will likely be compounded by a decision from the country's new Liberal government to impose a tanker ban on its West Coast.
