Oil is not ‘dead’ despite the eagerness of some to write its obituary

As much as airlines are suffering as a result of this pandemic — and that very much includes Canada’s major airlines — it would be absurd to argue that the airline industry is “dead.”

To be sure, the industry faces a long road to recovery and a great deal of uncertainty along the way. Some airlines might not make it, while others may be forced to downsize or to drastically overhaul their operations.

If we want Canada’s airlines to survive, then we need to look at how to help them through this, lest we find ourselves in the future dependent on foreign carriers. But no one seriously thinks that the airline industry has no future, and such a claim would likely be met with derision.

It is through a similar lens that we should view the comments about the oil and gas industry from former Green Party leader Elizabeth May and, to a certain extent, from Bloc Quebecois leader Yves-Francois Blanchet.

On Wednesday, May declared that the oil and gas industry was no longer viable, citing the pandemic, the drop in prices resulting from the price war between Russia and Saudi Arabia, and what she sees as growing demand for alternative forms of energy. In response to a follow-up question, May was blunt: “Oil is dead,” she said.

1:39 Coronavirus outbreak: Trudeau says he disagrees with May, Blanchet that ‘oil is dead’

Blanchet, meanwhile, more or less concurred with May, declaring that “tar sands are condemned and putting any more money in that business is a very bad idea.”

Fortunately, the prime minister made it clear that he did not share this assessment. It seems quite clear that both May and Blanchet are trying to advance their own environmental and regional agendas. They do not want the federal government to provide support to the oil and gas industry and are trying to convince Canadians that doing so is an exercise in futility.

They are wrong.

Allowing the industry in Canada to wither and die is a choice we’d be making. It is not an inevitable outcome from this pandemic. The death of Canada’s fossil fuel industry simply concedes that market share to other oil producers (just as a loss of Venezuelan oil last year conceded market share to Canada). There’s a reason why the Saudis and Russians are so ruthless in fighting for market share.

It is odd that May would point to the Saudi-Russian price war and even stranger still that she would see low oil prices as good news for green energy. The whole point of putting a price on carbon is to make fossil fuels more expensive, which discourages demand and also makes alternatives more competitive.

Once demand returns, those low prices will give fossil fuels a competitive advantage.

1:47 Virtual House of Commons descends into chaos after Conservative MP accuses ‘fringe left’ Elizabeth May of wanting to ‘destroy’ Canada’s oil industry

Prior to the pandemic, the International Energy Agency was forecasting that global oil demand would continue to grow for another 20 years, peaking at 106.4 million barrels a day in 2040. Undoubtedly, this pandemic has altered those forecasts, but hardly to the extent that May would have us believe.

Fossil fuels still represent about four-fifths of the world’s overall energy consumption. That number will obviously decline in the years ahead as the demand for renewables and other alternatives grows, but that hardly constitutes the basis for writing the industry’s obituary.

We don’t have to kill off Canada’s oil and gas industry to support a transition to renewables or to address the broader challenge of climate change. We do need to recognize that the world is, for now, still very much dependent on fossil fuels and it’s certainly in Canada’s best interests for us to remain a player in that global marketplace. The demise of Canada’s industry will only compound our economic pain and make our long-term recovery more difficult.

The prime minister was right to say, as he did, that Canada needs “the innovation, the hard work and the vision and the creativity of people working right now in the energy sector.”

Hopefully he’ll continue to ignore the likes of May and Blanchet on this point. The oil and gas business is not dead, despite those who wish it to be.

Rob Breakenridge is host of “Afternoons with Rob Breakenridge” on Global News Radio 770 Calgary and a commentator for Global News.