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Bad news for the oilpatch: no quick turnaround says Conference Board of Canada

The Suncor Refinery in Edmonton is seen on Tuesday, April 29, 2014. .
The Suncor Refinery in Edmonton is seen on Tuesday, April 29, 2014. . THE CANADIAN PRESS/Jason Franson

CALGARY – The Conference Board of Canada has some bad news for those hoping the crude oil downturn will be short-lived.

In its latest report, the Ottawa-based think tank says the industry is unlikely to bounce back as quickly this time as it did after the last major drop in 2008 and 2009.

Crude prices saw a much more drastic drop the last time around – touching records above US$140 a barrel and lows around US$33 in a half-year span – but by 2011, were back above US$100.

This time, the board says prices aren’t likely to climb above US$80 a barrel in the foreseeable future – thanks to drilling technology that has unlocked huge volumes from U.S. tight oil formations.

The outlook through 2019 is about US$30 below what the board had forecast during the first quarter of 2014.

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The Conference Board predicts revenues will drop by 38 per cent between last year and this year and the $56 billion invested in 2014 is likely to be the high water mark for oil spending in Canada.