Oil production in Alberta is climbing this year. The province produced 238,000 more barrels per day in the first eight months of 2018 than it did over the same period the year previous.
Extraction is also on the rise. In keeping with rising global demand for oil, crude production in Alberta has gone from under 2 million barrels a day in 2010, to more than 3.7 million barrels a day as of August of this year.
This increasing activity is a major boon to the Alberta economy and explains the need for added pipeline capacity. We have heard a lot lately about the transportation problems plaguing the sector. The pipes are full and our oil is backing up in storage tanks.
Even with more Alberta oil moving by rail, transportation bottlenecks will push the price down. This, combined with the recent drop in demand due to maintenance at a number of U.S. refineries, has widened the gap between the price we could be getting for our oil and the one we currently are.
Without better access to markets, whether in the U.S. or further afield in oil hungry countries like China and India, the full economic benefits of the extra production simply won’t be realized. (source: The Owl - ATB Financial)