Oil prices have risen to a staggering US$120 per barrel in the wake of Russia’s invasion of Ukraine. But that’s not a record in real-dollar terms. Inflation-adjusted oil prices reached the same level in 2013, driving a supply response that temporarily lowered prices. World oil demand steadily increased, reaching a record 100 million barrels per day before the COVID collapse.
Demand has since come roaring back and despite all the “net zero” rhetoric, the International Energy Agency forecasts that world oil demand will continue to grow. The big question is: who will supply all that oil?
Middle Eastern countries, led by Saudi Arabia, will be major contributors and, despite U.S. and UK bravado in banning Russian imports, current and forecast world oil demand cannot be met without Russian oil. The disparate list of countries controlling world oil supply may soon include Iran if, as news reports suggest, President Biden is naive enough to remove oil export sanctions in return for the Ayatollah’s “pledge” to suspend uranium enrichment. That would leave world oil supply security in the hands of one country that subjugates women, another led by a murderous psychopath, and a third developing a nuclear bomb with the avowed objective of annihilating Israel.
Meanwhile, with the world’s third-largest oil reserves, Canada is sacrificing hundreds of billions of dollars per year in revenues and new capital investment and tens of thousands of well-paying jobs on the net-zero altar by pursuing policies that make building new oil export pipelines virtually impossible. Even a proposed trans-national pipeline that would have delivered Canadian oil to eastern refineries was deliberately stymied by the Trudeau government. As a result, tankers carry Saudi Arabian and African oil that emits immensely more greenhouse gases than domestic oil up the ecologically fragile Gulf of St. Lawrence.
Speaking in London in July 2006 before departing for a Vladimir Putin-hosted G8 Summit in St. Petersburg, then-prime minister Stephen Harper called Canada “a new energy superpower.” Oil and gas industry capital investment rose sharply, doubling from $30 to $60 billion before the Harper government’s defeat in 2015. By 2019, Trudeau’s anti-oil and gas policies had seen the industry’s capital spending collapse to less than half of 2006 levels.
Many Canadians may not know that history. But if there’s one thing that does get their attention, it’s the price at the pump. Anti-fossil fuel ideologues worshiping at the net-zero altar may be delighted by the recent run-up in gas prices, but not real-world, working Canadians. On March 4, gas prices in B.C. hit $2.00 per litre, taking the cost of filling up the family sedan to $140. Given the sprawling nature of Canadian cities, commuting to work takes at least one fill-up per week. That amounts to more than $600.00 per month for a single car.
The theory behind carbon taxes is that higher prices will reduce consumption. But that only applies if there’s a viable alternative. For already cost-stressed, real-world Canadians, driving a vehicle that’s needed for business or for getting to work, a carbon tax on fuel is simply impoverishing.
This incredible answer comes at a time when innocent Ukrainians and their beautiful country are being ravaged by a megalomanic who threatens the world with nuclear Armageddon. No doubt President Putin is grateful to Justin Trudeau for helping him control world oil markets by having hamstrung Canada’s “energy superpower” potential. It was Putin’s predecessor Lenin who coined the phrase “useful idiots.”
Never before have I been ashamed of being a Canadian. I pray for new political leadership that will make me and millions of other dispirited Canadians proud of our country again.
