And now folks, for United Conservative Party Leader Jason Kenney’s next magical trick – he will predict the future! Oooh! Ahhhh! He thanks you!
And wants your vote! Naturally!
Actually, to date, Kenney hasn’t predicted anything of any importance. But he has laid on the line his political future with his latest on the “fiscal train wreck.” It’s stupid and offensive and takes Alberta voters for patsies.
There is one slight problem. By the time the future arrives, either Kenney will be premier of Alberta, or he won’t be. Either way, he can laugh off his foolishness. Or arrogance. Take your pick.
Basically, Kenney tells us he knows what the price of oil will be in mid next year. This is, as anybody in the oil business will agree, quite a feat.
Billions of dollars trade every day in oil contracts and futures markets. Billions more trade in the shares of companies which deal in oil. Heck, you deal in oil just about every day you fill up your vehicle. Should you do it now? Or wait a day or two when it might be cheaper?
That is where Alberta Premier Rachel Notley found herself last year in November. She was announcing the buy of perhaps 7,000 tanker rail cars to get Alberta crude to market. Existing pipelines were full. Surplus oil flooding the market was pushing Western prices to unheard of low levels.
She could sit on her hands, doing nothing but whine to the federal government. Or she could take bold steps. Among those steps were cutting production, and buying the rail cars. She did both.
Now the whining came from companies like Exxon and Suncor. They were making millions every day, simply because they owned their own refineries. Low prices didn’t bother them. It just made it insanely cheap to buy raw feedstock.
You probably didn’t notice pump prices go down. Because they didn’t. The companies just shoved the extra cash in their bank accounts.
The production cuts brought prices back to normal. Which is to say, Alberta in general was no longer losing up to $80 million per day from those insanely low prices. Do the arithmetic. That’s about $30 billion per year Alberta was losing. Notley could have cut production by three-quarters, instead of the less than 10 per cent she ordered, and everybody would still be making more money.
The whiners kept on whining.
Besides Kenney whining, here comes Edmonton Sun newspaper columnist Lorne Gunter. Last week he huffed how Notley first said the rail cars were going to cost $350 million. It could be correct.
But when the story broke last year the Globe and Mail newspaper quoted in the same story “experts” as saying the cars alone would cost over a billion. Engines another $250 million or more. Today, it’s fewer cars for more money.
Kenney says the train plan is a “fiscal train wreck.” The bottom line? Kenney must have a magical crystal ball.
Gunter whines about spending one or two billion to avoid losing up to $30 billion. And you know what? Nobody is adding up what the extra sales of Alberta oil will bring.
Several billions likely. A pox on these whiners!