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by Stockwatch Business Reporter
West Texas Intermediate crude for September delivery lost 73 cents to $41.22 on the New York Merc, while Brent for October lost 69 cents to $44.40 (all figures in this para U.S.). Western Canadian Select traded at a discount of $11.80 to WTI, down from a discount of $11.62. Natural gas for September added seven cents to $2.24. The TSX energy index added a fraction to close at 82.23.
Despite the ravages of COVID-19, Alberta oil sands production is poised to rally and enjoy a decade of steady increases, according to IHS Markit. The London-based research firm has tweaked its oil sands forecast and says production will hit 3.8 million barrels a day in 2030, a 40-per-cent or 1.1-million-barrel-a-day increase over current levels. The new 2030 forecast is only slightly lower than the prepandemic prediction of 3.9 million barrels a day. Essentially, while COVID-19 has added to the factors that were already limiting investment in the oil sands -- such as a lack of pipeline capacity and the resulting volatility in domestic pricing -- the pandemic's effects will be temporary, and the oil sands will enter a sustained period of rising production as new transportation capacity ramps up. "Despite the COVID-induced shocks of 2020," concluded IHS vice-president and oil sands specialist Kevin Birn, "the longer-term expectations for Canadian oil sands are not far off from what was expected prior to the pandemic."
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