The price of Canadian crude just went up.

[Bigfoot]

The US had a monopoly on Canadian crude so we got it at a price lower than the international rate. Harper doesn't like bowing to the whims of a single customer (Keystone delay) so he's going ahead with the Asia pipeline and we'll have to compete with China. No more discounted oil for the US.

Don't expect to see this story on the evening news.

<broken link removed>

"Look, the very fact that a 'no' could even be said underscores to our country that we must diversify our energy export markets," Harper told Harman in front of a live audience of businesspeople, scholars, diplomats, and journalists.

"We cannot be, as a country, in a situation where our one and, in many cases, only energy partner could say no to our energy products. We just cannot be in that position."

His wide-ranging question-and-answer at the influential non-partisan think-tank -- which also touched on border security, trade, the Arctic and Syria among other topics -- followed a meeting with Obama and Mexican President Felipe Calderon at the White House for the sixth North American Leaders' Summit.

Harper also told Harman that Canada has been selling its oil to the United States at a discounted price.

So not only will America be able to buy less Canadian oil even if Keystone is eventually approved, the U.S. will also have to pay more for it because the market for oilsands crude will be more competitive.

"We have taken a significant price hit by virtue of the fact that we are a captive supplier and that just does not make sense in terms of the broader interests of the Canadian economy," Harper said. "We're still going to be a major supplier of the United States. It will be a long time, if ever, before the United States isn't our number one export market, but for us the United States cannot be our only export market.

"That is not in our interest, either commercially or in terms of pricing."

Read More

 

[John H]

It was going to China anyways. They tried to get the pipeline to the pacific first, but ran into to much resistance, so then they tried running it through the US.



China invests billions in Canada oil sands - Houston Chronicle

 

[Bigfoot]

We export refined fuels. For example, Europe has many diesel cars so we refine the crude, keep most of the gasoline for domestic use and export much of the diesel there.

Venezuela crude is very similar in composition to the Canadian Oil Sands crude. We refine it on the gulf and sell much of the gas here (CITCO) and sell some, and other refined fuels on the international market. Wouldn't it be better to do business with Canada rather than Chavez?

The argument that we wouldn't profit from Canadian crude and that we wouldn't get the market advantage of the additional supply is false.

Edit: John H I might have misread your post. I'll leave this out here because someone will come along and say that the Keystone pipeline crude would go straight to China.

 

[John H]

Edit: John H I might have misread your post. I'll leave this out here because someone will come along and say that the Keystone pipeline crude would go straight to China.

Are you saying it won't go to China??

 

[Bigfoot]

If by "it" you mean all of it then I say no. Yes some crude will go straight to China, but even then we will benefit from it in several ways.

The Gulf Coast refineries that were built to refine the heavy Venezuela crude are running under capacity. It takes several years and billions in investment to convert a refinery to use heavy crude that's why even the Canadians won't do it in this decade. If the oil goes through the gulf as much as possible will be refined there.

Exporting refined fuels helps our balance sheet.

 

[ATCclears]

I've been tracking this issue for a while since I'm originally from BC/Canada and I still have many friends up there. The general sentiment there is to build a pipeline West across Northern BC and send the oil direct to China if the US doesn't want to play ball. I believe Kitimat, BC would be the port, and they're estimating 220 tankers going through there per year.

Peter