In short, Eastern oil consumers and Western oil producers most likely disagree about who controls what, and who it "belongs" to.
Control of oil comes from the marketplace, not from any buyer. Let's just imagine that the Canadian government mandated oil sales to China. China would then buy less from everyone else and American firms would still end up paying about the same price on the world market and getting about the same amount.
The only difference? According to John Palmer, economics professor at the University of Western Ontario, "We would force Canadian producers to pay more to ship it to China instead of the United States. In the process, we would further strain Canada-U.S. relations while donating cheap oil, by probably subsidizing the transport costs, to China."
Prime Minister Paul Martin should keep that — among other things — in mind when he decides to use oil to threaten the United States. Speaking two weeks ago in New York, the Prime Minister attempted to address the ongoing softwood lumber dispute. He hinted that Canada would look at China and India as a marketplace for "our" oil, restricting energy exports to the United States, if the Bush administration doesn't smarten up.
Apart from how morally questionable it is to suggest that trading with a dictatorship like China is a preferable/equal option to trading with a free country like America, there is also the matter of reality.
Canada is dependent on the American market, which buys approximately 85 per cent of what we have to offer. This is not to mention how our Prime Minister is causing further deterioration of already tenuous Canada-U.S. relations.
In the world market, oil is fungible. Who sells how much to whom is of little import. The price is determined by supply and demand, not a single oil company, or state. Certainly, if American demand dropped, so would the world price, but American firms do not set oil prices.
It would be nice if Canadian politicians would realize all of this and find less childish ways to deal with our largest trading partner. We always seem to be reacting against the United States, rather than carefully thinking through our rhetoric and our options.
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Rondi Adamson is a Toronto writer whose work has been published in the Christian Science Monitor, Wall Street Journal Europe and USA Today.
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Canada Doesn't Have Oil, Alberta Does, And U.S. Is Our Main Trading Partner
Posted on Monday, October 24 at 12:08 by jensonjContributed By
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This belief that if we (Alberta) decides to sell their oil to China will cause the U.S. to simply purchase their oil elsewhere is nonsense. Currently the U.S. consumes about 25% of the worlds oil and produces about 10%. The entire American way of life which we hear so much about is completely dependent on the ability for them to obtain this much oil.
That is the true motive for the bogus "War on terror". Peak oil is here and the American way of life, as is ours, is in danger of collapsing because of it. This whole spreading democracy is nonsense as well, why doesn't the U.S. go spread democracy to China, they are completely repressed? Oh, thats right, they have nukes.
I'd like to see Alberta cut off the oil supply to the U.S. and see how long it would take for the U.S. to start flying planes into buildings and blaming Canada this time.
It is still the most costly produced Oil in the world and if it were not for world events it would still need to be subedited to be able to sell its oil on the world market or even to generate interest by the oil industry.
So everyone in Canada, not just Albertans, has a stake in the oil sands and so have a right to a share of the benefits.
Any Albertan of any long family history in that province knows that Alberta as well as any other province in Canada has been helped to grow and develop through combined national taxes and national imports and exports to become what they are today whether they like it or not, that includes Ontario and Quebec.
Alberta’s Government is mostly just about smoke and mirrors not reality. American want a be's and anti-Canadian in nature.
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Perception is two thirds of what we perceive reality to be.
Difficult decisions are a privilege of rank.
It is still the most costly produced Oil in the world and if it were not for world events it would still need to be subsidized to be able to sell its oil on the world market or even to generate interest by the oil industry.
So everyone in Canada, not just Albertans, has a stake in the oil sands and so have a right to a share of the benefits.
Any Albertan of any long family history in that province knows that Alberta as well as any other province in Canada has been helped to grow and develop through combined national taxes and national imports and exports to become what they are today whether they like it or not, that includes Ontario and Quebec.
Alberta’s Government is mostly just about smoke and mirrors not reality. American want a be's and anti-Canadian in nature.
---
Perception is two thirds of what we perceive reality to be.
Difficult decisions are a privilege of rank.
I can remember when living in Alberta,the Feds forgave a $20 million? dollar loan to Shell Oil. This is when Shell backed out of the oil sands, considering it to expensive. I remember because they wrote to me to advise I still owed revenue Canada $15. All Canadians have/are paying for the tar sands. Canadians also pay to get it back.
I don't see the logic! It's rare that the shipper pays for shipping. Perhaps Martin can arrange a deal with China to use his fleet.
If the US has more options once Canada eases the burdon on their supply and China does rely more on Canada, the US will have to pay for shipping as well. There is no such thing as "cheap" in the oil field.
Bushit!
Control of oil comes from democratic procedure not the "free market". Enough of the free market zombie idea that markets will control everything and do it in everyone's best interest. Profit uber alles is not in my, your or any average Canadian's best interest.
Good grief, get your head out of America's ass and see the light buddy! Peak oil is here and its going to change our lives because no bridge technology is here to steam the bleeding until a real alternative is in place.
Scrap NAFTA or mainly the guaranteed percentage of energy clause. Canadians first - or to quote that famous neocon line - do you hate your own country? Support the Seniors!
Albertans need to learn that oil beneath the ground doesn't belong to them, it belongs to all Canadians. The same could be said for all of our natural wealth. This greedy me first attitude of some provinces and Canadians is disgusting and oh so American.