RE:RE:RE:RE:RE:RE:RE:RE:RE:Q1/2023 COP CC Second Question by Neil Mehta On Surmont1......oil demand stays flat for the foreseable future
Agree......i don't see WTI oil prices revisiting above $100 anytime soon, UNLESS either nukes are involved somewhere OR some unforseen backswan event happens. So energy prices will be "flat" & will be kept at these levels NOT to BK Europe, Asia & South America. BUT they will BK Russia if they stay below $70 for any prolonged period, which imo IS the intent & objectives of the US & EU.
2....the price of oil stays in and 85 a barrel in inflation adjusted prices
$85 is doable but not without at "great" cost. As long as NG don't follow suit, it should be too much of a problem for most to adjust. But as you've stated, it will come at a "significant" cost to consumers in the form of inflation....across the board. So don't think those dozen eggs or loaf of bread are gonna come down in price anytime soon if we have $85 oil for a few years. The other "great" cost or compromise for having ~$85 oil, is that Russia could continue, unabated funding the war machine for many years to come........non stop.
3....SU does not get approval to extend the Base Plant
Well, for this one, let me phrase it you this way. Do you think that Suncor would go "all in" by doubling, tripling down on the Oil Sands, without some "assurances or guarantees" from the both the federal & state regulators to make sure there are no unforseen bumps on the road?
Therefore, If you believe that Suncor's team isn't that astute, savvy or well informed on these matters and are more or less incompetent at all levels then, then point 3 would be a total unknown, up for grab & in the hands of our dear lord, Jesus...... for them. But IF they did their homework, covered all angles and took into account EVERY risk, then your last point should figure at all, because they're covered all their bases.
Which one do you think it is?
"If SU is unable to get environmental approval for a big enough extension for Fort Hills (AND i'll just add here ANTICIPATED Cop's ROFR as well lol) then they will have no choice but try and buy out somebody else. If they are in this position, then they will likely have no choice but to pay a premium for such acquistions especially if oil prices stay at 85$ in real terms."
Then i guess if all that is true, then the good folks at SU HQ ARE NOT the smart, wise & perceptive folks we thought they were........
GLTA