Many motorists choose their gas pump visits to match the small dips that occur in the day-to-day pricing of gasoline. I call tbis a “mug’s game.” It’s a term my old boss, John Bassett of the Toronto Telegram, was fond of applying to efforts of his editors to shoehorn late breaking news into a front page that was ready to go to press.
Oil reached an all-time peak of $145 a barrel in 2008. Then came the Great Recession. Prices for West Texas oil tumbled to an historic low of $26.55 per barrel in January, 2016. They have since almost doubled, to around $51 today. And further increases are coming, according to the U.S. Energy Administration. It predicts oil will average $52 a barrel in 2018, rising to $75 by 2020, $109 by 2040, and peaking at $116 in 2050 (all in 2017 dollars).
Talk about a mug’s game!
Forecasts like these are usually upset by unforeseen, or even expected, events. Who foresaw the Great Recession? Who could have predicted that Saudi Arabia would decide to pump surplus oil into the market in order to knock down prices — and so drive new competitors, like the shale oil industry in the United States,and the Alberta oil sands in Canada, toward bankruptcy.
Anyone who thinks Big Oil is here to stay should read Chris Turner’s epic history of the oil sands, The Patch: The People, Pipelines, and Politics of the Oil Sands. In it, he analyzes how that stretchof oil-drenched loam and sand in northern Alberta has been dug into, carved up, and generally desecrated.
Turner, a veteran Calgary author and journalist, is not anti-oil sands. He’s more interested in how the rise of the oil sands and its capital, Fort McMurray, has affected the people involved — everyone from local Indigenous, to Newfoundland fishermen and Pakistani immigrants who found work tapping into the underground wealth of that northern terrain.
Turner begins The Patch with an account of a small environmental disaster: the death of 1,601 ducks who landed on a Syncrude tailings pond in the middle of a snowstorm. They thought they’d found a safe haven, but didn’t understand that what they took for open water was actually a tarry mix of oil, heavy metals, and chemicals.
From that debacle, Turner goes on to recount early attempts to develop the oil sands. He describes how corporate America came to the scene with the arrival of Sun Oil in the 1950s, becoming a partner in a consortium called Great Canadian Oil Sands.
By 2006, Turner writes, “twice as many Newfoundlanders worked in Alberta as there were employed in the decimated fishery back home.” Then came the twin disasters of the Great Recession and the “The Beast,” the fire that enveloped much of Fort McMurray and the surrounding oil sands territory.
Turner reports on environmental studies that present “a powerful litany of abuses.” He adds: “The oil sands is the largest new source of carbon pollution in Canada — but its emissions intensity per barrel has been dropping steadily for years.”
Despite this, Turner says, “A thing of such scope and power and wealth as The Patch doesn’t go away overnight or in a few years. Building the entire industrial basis of modern society on a new energy regime does not happen overnight or in a few years. We will have The Patch for years, decades … We are all stakeholders. We are all complicit.”
When the Energy East pipeline was cancelled a few weeks ago, it was admitted that market forces — a declining need for new pipelines beyond the Kinder Morgan in B.C. and the Keystone XL in the States — were the main factor in the decision.
Less attention was paid to the announcements of a string of car companies from General Motors to Volvo that they would be phasing out gasoline models in favour of electric vehicles over the next ten to fifteen years. With two-thirds of world oil production now going to power cars, buses, trucks and planes, can oil be anything but a declining force in a future of electric vehicles?
I began my writing career with an article about the oil sands that the Rocky Mountain Oil Reporter published in the 1950s. It was one of the first pieces to recognize that a great new industry was soon to come into being. I congratulated myself on the $12 check I received.
Now, the oil sands are one of the most widely written about industries in the world. In The Patch, Chris Turner has written a book that brings to life a significant slice of modern Canada. But perhaps his book also signals the last great hurrah for Big Oil.