Globalization Of Oil In Canada

Oil is one of most important items in the world. Where you have oil you have money the two correspond with another. The fluctuation on the prices of oil can have dire consequences to the economy of a nation and a province. There is oil in Canada and the government has noticed that, the government has put numerous implications to improve our exportation of oil. With the drop in the price of oil some provinces in Canada like Alberta will have a tough time rebuilding the lost revenue. It is estimated that alberta will lose up to “seven billion dollars” While the drop in oil prices is bad for somethings there are a few benefits that will come. Gas will be cheaper, and that will “save Canadians an estimated 10 billion dollars.” Oil is key component …show more content…
Supply and demand. There isn’t enough demand for oil right now. There is turmoil in china and the demand for oil there is at an all time low. China is the number one consumer of oil in the world, but with an economic slow down there demand for oil was less and less. Europe also a big comsumer of oil has a weakening economy so the demand for oi there is becming less. Another interesting point is more and more fuel-efficient cars are being sold and used in our streets, with more fuel efficient cars people are not filling up as much. The demand for oil is at an all time low. Although there is less demand the supply of oil is plentiful. In north Dakota and Texas a lot of oil has been extracted causing more and more oil to just sit and wait to be exported. In Alberta the oil sands have the third largest amount of oil behind only Saudi Arabia and Venezuela, there is “approximently 166 billion barrals worth of oil. There is also added competion in the oil market as Saudi and Nigerian oil are now competing against the USA and Canada causing the price of oil to drop. Recently in Canada the oil production was suddenly seized as forest fires destroyed the region where the oil sands were located. These played some parts into the drop of oil prices when it comes to the supply portion. When it comes down to it, its simple economics there is too much oil but little demand. While it all looks bad there are some benifets that come with the low oil prices, …show more content…
A trade deficit is caused when we import more than we export a trade deficit. Exporting goods is key to any economy the more we export the more our economy grows. Exporting oil can be beneficial to any economy. Look at Alberta, According to oilsands.alberta.ca “21,500 people were employed in Alberta 's upstream energy sector, which includes oil sands, conventional oil and gas. Royalties from the oil industry in alberta were “3.56 billion. Alberta exports of goods rose by about 50 per cent from 2002 to 2012 to $95 billion, which includes almost $68 billion in energy and oil exports.” The increase of oil exportation in Alberta created more jobs, which means people, can spend money and when people spend money the government takes a portion of it. This is the economic circular flow everything is connected. When there is more exports than imports the economy grows and develops. As oil prices dropped and less demand for oil recently the exportation of oil has become slower. Thus in turn has caused negative consequences for provinces and countries economy’s. In Canada its been noted that we have been major players in oil exportation recently, with the declining price of oil and less demand our GDP will suffer. It is estimated that, “One third of a percentage point will be lost because of the oil prices.” This in cause will cause fluctuation of

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