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by Stockwatch Business Reporter
West Texas Intermediate crude for July delivery added 23 cents to $52.51 on the New York Merc, while Brent for August added 70 cents to $62.01 (all figures in this para U.S.). Western Canadian Select traded at a discount of $13.05 to WTI, up from a discount of $13.27. Natural gas for July added six cents to $2.39. The TSX energy index lost a fraction to close at 138.19.
It was another day, another blow for energy companies. This morning, the International Energy Agency (IEA) lowered its outlook for production gains in 2019, citing global economic weakness. It previously forecast that 2019 production would rise by 1.3 million barrels a day, but now says 1.2 million. "The worsening trade outlook [is] a common theme across all regions," said the Paris-based agency. It did, however, forecast a recovery in production gains in the second half of 2019 and 2020, thanks to economic stimulus packages.
The IEA's forecast came on the heels of an even gloomier, Canada-specific report released yesterday by the Canadian Association of Petroleum Producers (CAPP). CAPP's latest annual Crude Oil Forecast, Markets and Transportation report showed a "constrained outlook" for Canadian oil production from 2019 to 2035, with a mere 1.44-per-cent annual increase being projected, less than half of what had been projected in the 2014 report. CAPP added that capital spending in the oil sands is set to decline for the fifth year in a row to just $12-billion in 2019, a mere one-third of the investment seen in 2014. Overall investment in Canada's oil and gas industry is pegged at just $37-billion in 2019, down from $81-billion in 2014. CAPP pinned the blame on "continual delays in obtaining increased market access" and "inefficient and duplicative regulations."
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