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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: Hi folks,can you explain the difference between WCS (West Canada Select) pricing versus WTI. TD shows Wcs at $40sh while Wti is $57sh;that is a huge differential spread. Does this affect companies I own; Rrx/t & Pey/t?? or mostly involves companies in The "Oil Sands" like Cpg & Cve. I understand no new pipelines hurt but is the Wcs price, what is holding Canadian oil companies from participating in the recent Wti runnup. Thanks as always and just renewed 2 more years into 2020 haha, jb Piedmont QC
Read Answer Asked by John on December 07, 2017
Q: I note Rosenberg’s article in the globe this morning in which, among other things, he likes energy stocks at the moment. Do u agree with his assessment and if so would u purchase individual stocks or an ETF and would u focus on producers or service providers and in which geographical area? Can you provide specific recommendations. Thx
Read Answer Asked by Patrick on October 30, 2017
Q: After a fair amount a reading on the energy sector from a macro perspective, I've decided to start putting money back into oil stocks. However, I'm uncertain about which sub-sector to invest in, namely refiners, exploration and production, pipelines, service companies, etc. Which sub-sector would you consider has the best potential for the next decade and which companies in your preferred sub-sector do you like the most? I'm open to Canadian, U.S. and global companies.
Robert
Read Answer Asked by Robert on October 16, 2017
Q: Why is everyone pumping like crazy except OPEC? Is it market share or, especially the US shale drillers, is everyone trying to take business from OPEC at the expense of selling their oil at a lower price. It makes sense to me to cut back a bit and let the price rise so, with a higher oil price, revenues go UP and resources do NOT go up exponentially. What am I missing?
Is it time to start accumulating Canadian oil stocks - Surge is below two dollars, Spartan is $1.85!!, Gear is sixty cents and RMP is a half a dollar. Are these stocks good to a significant bump when oil rises and would you now see it to be a good time to slightly average down on heavy losses?
If not now, when? I know the BTA - Border tax adjustment - is still an issue and you have favourites other than the above-listed. I am looking at WCP, RRX and VET, as well.
Thanks.
Read Answer Asked by Steven on June 22, 2017
Q: Gary's question regarding the border adjustment tax 9BAT) on oil reflected my concern, as well. Presently, Canada ships 3.5 boe and Mexico is at about 800,000 so energy independence seems well down the road. If there is a BAT, some have said gasoline prices in the US will rise proportionately. I don't understand that conclusion. Canada only gets $40/barrel and Mexico $46. They can't raise the price to cover the tax so does that mean US recipients will get less and then raise prices to consumers?
Thanks.
Read Answer Asked by Steven on February 02, 2017
Q: Cdn energy stocks have recently sold off much more than oil largely due to concerns of a potential Trump border tax. What probability would you give this of actually occurring and do you believe the current sell-off already reflects the potential risk? Further, pipelines have declined significantly in recent days as well. Could they also be subjected to or impacted by a border tax and is this likely the reason for the recent decline? Thanks.
Read Answer Asked by Gary on February 02, 2017
Q: I have never understood the mathematics of OPEC'S potential production cuts. If they cut between 1.1 and 1.7M barrels daily - including NON-OPECers such as Russia, that would be a 4-5% reduction. With that cut, oil will most likely rally at least 10%. So, it would seem apparent that producers could produce less of their reserves and generate more revenue/profit every day. If oil rallies to $55-60, the case is even stronger. I suppose the only hitch is the rest of the world pumping more but that can be mitigated somewhat by what world demand could handle as going overboard puts the situation back where it is now.
Sounds good to me. What do you think?
Read Answer Asked by Steven on November 27, 2016
Q: I have a negative view of the future for oil and gas stocks. The world seems awash in oil, OPEC is a dead pigeon and demand is weakening and will continue downhill rapidly as electric cars become the fashion. CNQ and many of the oil majors seem to me to be over-priced and shorting them would be a good trade. Is this a crazy idea?
Thanks, Peter
Read Answer Asked by Peter on November 25, 2016
Q: Thanks for the blog "Who gets impacted by a carbon tax?".
While Saskatchewan and Alberta show the highest per capita impact in your analysis, isn't it energy users who will pay the bill? With the largest populations, won't a considerable part of the cost be borne by Ontario and Quebec drivers, particularly drivers of the least fuel efficient vehicles?
Also, do you happen to know how a carbon tax impacted countries that implemented it years ago? Thanks for any references you have on this. Edward
Read Answer Asked by Edward on October 11, 2016
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