In a hurry: Global oil demand is declining and Canada is ousted even before the end of Big Oil is near

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Hello!Total SE’s decision to move further away from Canada was long in coming. But it was still a big blow to the battered oil plate.

On Wednesday, the French oil giant said it was taking a US $ 7 billion depreciation on its Canadian oil sands assets and tightened the screws further, adding that it would not approve any capacity increases on Fort Hills and Surmont. , its two Canadian assets. The French company estimates that global demand for oil will peak around 2030.

Alberta Energy Minister Sonya Savage criticized Total’s decision.

“Canada – which has the third largest oil reserves in the world – is uniquely positioned to continue to offer investments in a stable and ethical democracy. Our province and our industry are bound by the rule of law, respect for human rights, gender equality and a strong and transparent regulatory system, ”Savage said in a statement.

“At the same time as Total rejects the leadership of Canadian producers who are doing their part with active emission reduction strategies, they are continuing to invest in countries like Myanmar, Nigeria and Russia. This highly hypocritical move comes at a time when international energy companies should, in effect, be increasing their investment in Alberta, rather than arbitrarily abandoning a stable and reliable source of energy.
It is complicated.

The world has looked at the oil industry through the lens of climate change, but has struggled to see it from a geopolitical perspective.

Venezuela, the country with the world’s largest oil reserves, is in tatters and has seen its production drop. Other notable producers such as Mexico, Iran, Libya and Nigeria are also struggling to increase production.

While demand for oil may well plateau around the middle of the century, we’re unlikely to stop refueling our cars and jets anytime soon. And the world will always need a variety of suppliers – preferably not concentrated in a single region – for energy security purposes.

Still, there are real concerns that demand for oil, which topped around 100 million bpd last year, will never return to that level amid structural changes. Currently, demand for oil sits at just under 87 million bpd, and some believe the industry’s best days are behind it.

“People are waking up to a new reality and trying to work their heads around it all,” an industry source close to OPEC told Reuters, adding that “the possibility exists on everyone’s minds. key players ”that consumption never fully recovers.

Another official told Reuters: “Demand is not returning to pre-crisis levels or it is taking time for it to happen,” he said. “The main concern is that the demand for oil will peak in the next few years due to rapid technological advancements, especially in car batteries.”

A number of major oil producers such as Saudi Arabia and the United Arab Emirates are currently investing heavily in their oil resources to maximize the value they can extract from their resources while they can. Saudi Arabia sells family money to help diversify its economy. Last year, the government listed its oil company Saudi Aramco on its stock exchange. Meanwhile, the UAE recently sold stakes in some of its valuable oil assets to international investors with the aim of monetizing them. Both countries use the funds to diversify their economies.

The next few years will be crucial for Canadian hydrocarbons, as they are pressed not only by rivals and financiers, but also by a disengaged federal government.

Alberta and the federal government will need to play a smarter game to extract value from the increasingly stranded resource – even as it reduces its dependence on it – and not be left out of the Great Oil End Game until it is not really finished.

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