NEW YORK/CALGARY, Alberta - North American energy traders are reluctant to take up long-term positions on Canadian crude price moves, preferring to stick to spot deals, as uncertainty around government intervention in the market grows following delays to a critical pipeline project.
Severe pipeline bottlenecks depressed Canadian heavy oil prices to the weakest on record last year, prompting the Alberta government to order mandatory production cuts effective Jan. 1, a move that sent prices sky-rocketing and traders scrambling to cover positions. But sources at producers and refiners on both sides of the border said it has become more difficult to make a compelling case to management to buy Canadian oil contracts for later in the year because of the uncertainty related to what the government might do.Not being able to lock in forward prices typically heightens risk for producers and refiners, leaving them more exposed to fluctuating spot commodity prices.
“I won’t take any forward positions in Canada right now. Everyone is wondering what the government is going to do ... one announcement can ruin your year,” one trader said. Further muddying the picture, current Alberta Premier Rachel Notley’s New Democratic Party government is currently trailing in the polls ahead of a spring election, facing a stiff challenge from the United Conservative Party.Alberta government spokesman Mike McKinnon said the cuts had been applied fairly and equitably.
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Fonte: AP - 🏆 728. / 51 Leggi di più »