more production less demand for 2023CALGARY — Canadian oil and gas companies are expected to increase spending in 2023, but analysts say it will be another year of modest growth and not a return to boom times. “The oil producers have become far more financially disciplined over the last six or eight years,” said Philip Petursson, chief investment strategist at IG Wealth Management, adding the threat of a looming recession in 2023 is one factor preventing oil and gas companies from getting carried away with spending plans. “What we know is that in an economic downturn, oil demand falls,” Petursson said. “So I think (companies) are going to want to be a little more measured and not say ‘hey, oil prices are just going to trend higher — let’s go all in in 2023.’ ”
In Alberta alone, over the first 10 months of 2022, crude production averaged 3.7 million barrels per day — an all-time record thanks to surging global demand, according to ATB Financial.
Experts say production will be even higher in 2023, based on the already released capital budgets and production guidance of oil and gas companies. Many companies were able to pay down large amounts of debt in 2022, so will have more cash flow available next year as long as commodity prices hold around that US$75 per barrel mark.