What does negative price mean? When supply exceeds demand to the point that the seller pays the buyer to take the product or to store the product for them. Jokingly, if you’ve got a storage tanker, suppliers will beg you to take and store to make way for production as every buyer is saturated with oil.
“…Hundreds of thousands of Canadian jobs are on the line…this is not an Albertan issue, this is not a Canadian issue…this strikes right at the heart of the entire Canadian economy…Canada cannot afford to loose 500,000 Canadian jobs connected directly or indirectly with such an import industry that has paid 370 Billion in revenues…over that past 18 years alone…I publicly renew our urgent request for federal action in this regard…,” Premier Jason Kenney.
Alberta NDP Leader Rachel Notley issued the following statement regarding negative price oil price benchmarks:
“…It’s clear today that the federal investment in cleaning up orphan wells will not be enough to stabilize employment in the energy sector or help energy companies stay operational through this pandemic…Jason Kenney must act, and he must act now. The Premier keeps pointing the finger at Ottawa, but waiting for Justin Trudeau is not a strategy. Alberta’s oil reserves belong to each and every Albertan, and it is up to us to chart our own future. Almost three weeks ago, I asked the Premier if he had a plan to protect Alberta’s resources and manage the need for an orderly, structured shut-in in the event of a catastrophic negative price scenario that was damaging Alberta’s industry. He had no answer…By not preparing for today, Jason Kenney has abdicated his responsibility to manage the resources Albertans own. The Premier must hold an immediate emergency summit with energy producers to determine how the Government of Alberta can intervene in the market and facilitate a structured response to negative pricing that best protects the natural resources owned by the people of Alberta…We will come through this pandemic and when we do, Alberta will need bold action and new ideas to secure our energy future and diversify our economy for generations to come. So far, Jason Kenney and the UCP have proven incapable of showing any kind of vision for the future of our province”.
