A dramatic jump in oil prices linked to the promise of lower global production is fuelling hope that the Canadian oil sector may soon recover from a two-year slump.
Crescent Point Energy CEO Scott Saxberg says his Calgary-based company is ready to increase spending beyond its recently announced $1.45-billion budget for 2017 if oil prices continue to strengthen.
Precision Drilling CEO Kevin Neveu says North American drilling budgets are starting to rise, adding his company now has 72 drilling rigs working in Canada, up from about 60 at this time last year, which translates into about 250 more jobs.
Observers say they’re optimistic that Saudi Arabia, the top exporter in the Organization of the Petroleum Exporting Countries, is committed to cut exports to reduce a global oil glut.
They are also taking heart from news on the weekend that 11 producers from outside OPEC, including Russia, have agreed to reduce output.
Martin Pelletier, a Calgary-based money manager with TriVest Wealth Counsel, says he thinks the Saudis’ plan to sell shares in 2018 in the national oil company, Saudi Aramco, provides plenty of motivation for it to avoid cheating that has derailed previous production agreements.
