• 4 minutes Get First Access To The Oilprice App!
  • 7 minutes Blame Oil Price or EVs for Car Market Crash? Auto Recession Has Started
  • 11 minutes Japanese Refiners Load First Iran Oil Cargo Since U.S. Sanctions
  • 13 minutes Oil prices forecast
  • 4 mins Renewables in US Set for Fast Growth
  • 4 hours Oceans "Under Fire" Of Plastic Trash
  • 8 hours Is Natural Gas Renewable? I say yes it is.
  • 9 hours *Happy Dance* ... U.S. Shale Oil Slowdown
  • 3 hours Chinese FDI in U.S. Drops 90%: America's Clueless Tech Entrepreneurs
  • 9 hours Emissions from wear of brakes and tyres likely to be higher in supposedly clean vehicles, experts warn
  • 10 hours Making Fun of EV Owners: ICE-ing Trend?
  • 1 min Cheermongering about O&G in 2019
  • 19 hours Algorithms Taking Over Oil Fields
  • 21 hours Europe Slipping into Recession?
  • 23 hours UK, Stay in EU, Says Tusk
  • 1 day Nuclear Power Can Be Green – But At A Price
  • 8 hours Socialists want to exorcise the O&G demon by 2030
Oil Rises After Choppy Start To The Week

Oil Rises After Choppy Start To The Week

Oil prices rose by roughly…

This Is How Much Each OPEC+ Member Needs To Cut

This Is How Much Each OPEC+ Member Needs To Cut

OPEC published the list of…

Bank Of Canada Cuts Economic Outlook As Low Oil Prices Weigh

Bank of Canada

Bank of Canada said on Wednesday that it expects real gross domestic product (GDP) to grow by 1.7 percent this year, revising down its forecast by 0.4 percentage points compared to the October outlook, as the drop in global oil prices over the past two months has a material impact on the Canadian outlook.

“The drop in global oil prices has a material impact on the Canadian outlook, resulting in lower terms of trade and national income,” the bank said today, keeping the target interest rate at 1.75 percent.

Referring to the pace of interest hikes, Bank of Canada said that “The appropriate pace of rate increases will depend on how the outlook evolves, with a particular focus on developments in oil markets, the Canadian housing market, and global trade policy.”

Apart from lower international oil prices, Canada’s oil industry has seen transportation constraints and rising production, which “have combined to push up oil inventories in the west and exert even more downward pressure on Canadian benchmark prices.”

“While price differentials have narrowed in recent weeks following announced mandatory production cuts in Alberta, investment in Canada’s oil sector is projected to weaken further,” according to Bank of Canada.

In its Monetary Policy report also published on Wednesday, the bank said that the key challenges to its economic outlook would be the developments in oil markets.

Related: Is This The Answer To Canada’s Oil Crisis?

“The outlook is subject to several sources of uncertainty, including the persistence of the oil price decline and the size of spillovers to non-oil-producing regions, the adjustment of household spending to tighter mortgage finance guidelines and higher interest rates, and global trade policy and geopolitical issues,” the bank noted.

Since the October report, the sentiment in the Canadian energy sector has deteriorated, according to the bank’s consultations with firms in the industry. Although Alberta’s oil production cut has helped narrow the price differentials of Canadian heavy oil to WTI—with the discount at its narrowest in a year this week—energy companies in Canada continue to be concerned about the outlook in the medium term, Bank of Canada said.

“For instance, the ongoing lack of export infrastructure continues to hamper the ability of many energy firms to raise funds in debt and equity markets,” the bank noted.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment
  • Jim Miceli on January 10 2019 said:
    I kinda seem to think that China should find another outlet for it's 2nd. rate products and services and leave the USA and other prominent countries to increase both quality and assurance of it's economies in all respects. The mumbo jumbo in the news about Trade Talks , cutting forecasts , Oil glut , and the price of polluted air is enough to open an (ETF) on the amount of exhaust emitted across China on an hourly basis. Sure to make millions. Bye now and leave the USA Markets alone. Bounce the OIL price.

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News