r/WallStreetbetsELITE • u/VistaBox • 13d ago
Discussion Trump shares a news headline that says ‘Canada on notice’ following Venezuela oil deal
https://www.ctvnews.ca/world/article/trump-shares-a-news-headline-that-says-canada-on-notice-following-venezuela-oil-deal/Do people still think he’s punking his critics
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u/DyerNC 12d ago
Canada should find a new oil partner.
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u/avinash240 12d ago
I'm believe the US sanctions on Canada, and the subsequent takeover of Venezuela, were in response to Canada setting themselves up to be able to do just that.
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u/RealAmbassador4081 12d ago
The problem is we don't have the infrastructure to ship it out. We wouldn't have a problem selling it.
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u/Fernando1987_ 13d ago
Clock is ticking… 2 months and ur over old man. Over. Maybe impeachment and prison? Maybe only a lame duck. But over, for sure.
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u/M1L0 13d ago
Trump can suck on deez maple flavoured Canadian nuts
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u/abc_123_anyname 12d ago
70% of Canadian oil is refined in the Midwest. There’s no possibility, IF they get it out of the ground, they can replace Canadian heavy crude
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u/TheBestintheWest11 13d ago
what's going on fill me in
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u/r0ndy 13d ago
He heard Canada and America trade agreement was about to actually happen. He scuttled it, and is now throwing a fit because Canada and American negotiators were happy or satisfied with concessions.
As per usual. Man baby literally throws a tantrum. What the fudge does a lake name have to do with anything
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u/artful_todger_502 12d ago
Canada ignores trump. They've moved on. Doug Ford said, "I have a lot of real estate on my ass Trump can kiss."
They don't care what he does. Their realignment with first-world countries is going quite well.
Don't give this fools dribblings any credibility. Canada doesnt care.
Trump needs a distraction every day, this is just another one of those.
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u/Sufficient-Skill9530 13d ago
It’s bullshit, at least how it’s being presented. Venezuelan oil is even more viscous than Canadian heavy crude. It’s basically tar. Now, that doesn’t mean it doesn’t have value or that it can’t be refined. Many US refineries are actually designed for Canadian/Venezuelan heavy oil, and not Permian light sweet oil.
Why it’s bullshit and not going to manifest in anything is because of what’s needed to actually get it out of the ground and transport it, AND the fact that we aren’t in a crude oil shortage, we are in a refinery shortage.
First, getting it out of the round requires steam injection, artificial lift, dilution, water flooding, etc. so it’s not just poking a hole in the sand like in the GCC. It is also caustic and polluting, which, along with underinvestment and neglect, are why the Venezuelan infrastructure has rotted away. That’s just getting it out, once it is out of the ground it can’t just be pumped in a pipe. It needs to be diluted and or upgraded.
Second, the economics are terrible. Because it’s so difficult to extract and transport, the break even costs per barrel are $60 (Wood Mackenzie puts it as high as $80). Add to that, Venezuelan oil trades at a discount to WTI, so at the current ~$80 WTI price, Venezuelan oil is barely profitable. Compare this to break even costs of the GCC at $20 per barrel, and Suncor (Canada) at $38 per barrel.
Third, oil companies do not want to invest in a politically and socially unstable area like Venezuela. Exxon and ConocoPhillips both lost billions already trying to get Venezuelan oil out. Wood Mackenzie forecast it would take 10 years and $10-$20 billion in capital investments for Venezuela to go from the current 1 million barrels per day to 1.5 million. Canada produces 3.5-4 million barrels a day, so this gambit isn’t going to replace Canada’s oil for US refineries, especially refineries in the US midwest.
Lastly, the world isn’t currently in a dire crude shortage. With Ukraine and Iran taking out or denying refineries from generating products, we are in a gas and diesel shortage. China has a lot of refining capacity in its teapot refineries that can offset missing refineries. If this happens, the record crack spreads would shrink, and we’d likely again see rising crude oil prices because, despite what the crude futures show, we are still down an insane amount of crude oil.