Saudi-Iranian oil feud gives Justin Trudeau climate-change leeway: Walkom
In the short term, the oil-price feud between Iran and Saudi Arabia delivers no joy to the Canadian economy.
But it does give Prime Minister Justin Trudeau’s government more leeway as it attempts to negotiate a climate change deal with Canada’s provinces.
The central issue in both cases is the price of oil.
As long as oil prices are low, companies are reluctant to invest in the high-cost Alberta tarsands.
That reluctance has a ricochet effect throughout the entire country.
So when Saudi Arabia and other members of the OPEC cartel, as well as Russia, met in Qatar this past weekend to stabilize production, oil boosters were initially optimistic.
It seemed that the era of falling petroleum prices was finally coming to an end.
If implemented, the proposed production freeze would have reduced the amount of crude coming into world markets and eventually pushed up its price.
The good news is that continued low oil prices make it politically easier for Canadian governments to impose so-called carbon pricing in order to curb greenhouse gas emissions.
To all intents and purposes, carbon pricing is a tax on fossil fuels. Sometimes, as in British Columbia it is a straightforward tax. Sometimes, as with Ontario’s proposed cap and trade scheme, it is levied indirectly.
In both cases, it is an attempt to make consumers pay the entire cost of fossil fuels, including the social costs of events such as flooding and extreme weather that are caused by climate change.
Ontario’s very modest carbon pricing regime, for instance, will raise gasoline prices by 4.3 cents a litre in 2017, according to Queen’s Park.
Politically, it is easier to raise energy prices when they are low. Drivers are more amenable to higher pump prices when the underlying per-litre cost of gasoline is 90 cents than they would be if it were, say, $1.90.
https://beta.thestar.com/news/canad...tin-trudeau-climate-change-leeway-walkom.html
In the short term, the oil-price feud between Iran and Saudi Arabia delivers no joy to the Canadian economy.
But it does give Prime Minister Justin Trudeau’s government more leeway as it attempts to negotiate a climate change deal with Canada’s provinces.
The central issue in both cases is the price of oil.
As long as oil prices are low, companies are reluctant to invest in the high-cost Alberta tarsands.
That reluctance has a ricochet effect throughout the entire country.
So when Saudi Arabia and other members of the OPEC cartel, as well as Russia, met in Qatar this past weekend to stabilize production, oil boosters were initially optimistic.
It seemed that the era of falling petroleum prices was finally coming to an end.
If implemented, the proposed production freeze would have reduced the amount of crude coming into world markets and eventually pushed up its price.
The good news is that continued low oil prices make it politically easier for Canadian governments to impose so-called carbon pricing in order to curb greenhouse gas emissions.
To all intents and purposes, carbon pricing is a tax on fossil fuels. Sometimes, as in British Columbia it is a straightforward tax. Sometimes, as with Ontario’s proposed cap and trade scheme, it is levied indirectly.
In both cases, it is an attempt to make consumers pay the entire cost of fossil fuels, including the social costs of events such as flooding and extreme weather that are caused by climate change.
Ontario’s very modest carbon pricing regime, for instance, will raise gasoline prices by 4.3 cents a litre in 2017, according to Queen’s Park.
Politically, it is easier to raise energy prices when they are low. Drivers are more amenable to higher pump prices when the underlying per-litre cost of gasoline is 90 cents than they would be if it were, say, $1.90.
https://beta.thestar.com/news/canad...tin-trudeau-climate-change-leeway-walkom.html
