- Prices have risen as a result of Russia’s supply constraints as a result of its invasion of Ukraine. Canada’s natural resources minister stated that a number of countries are committed to “assisting in any way possible in substituting Russian oil and gas.”
- Canada’s export capacity is constrained by near-capacity pipelines, but Mr Wilkinson thinks shipping it via the United States is an option.
- Russia is a significant player in the worldwide nuclear energy business. Along with mining uranium, it also does much of the processing necessary to make it usable in power plants.
Canada says it can provide more oil, gas, and uranium to help solve the global energy crisis
Prices have risen as a result of Russia’s supply constraints as a result of its invasion of Ukraine. Canada’s natural resources minister stated that a number of countries are committed to “assisting in any way possible in substituting Russian oil and gas.” The world’s fourth-largest oil producer has promised to increase its oil exports by 200,000 barrels. It will also export an additional 100,000 barrels of natural gas, Natural Resources Minister Jonathan Wilkinson told BBC News.It comes in response to proposals made by its allies during a conference of the world’s energy ministers at the International Energy Agency (IEA) in Paris, during which ministers pledged to expedite the transition to sustainable energy.“By the end of the year, we aim to be fully up to 300,000 barrels,” Mr. Wilkinson stated. That is, however, a fraction of the three million barrels per day that the IEA estimates would be taken from global markets by next month as a result of Russia’s sanctions.
Canada’s export capacity is constrained by near-capacity pipelines, but Mr Wilkinson thinks shipping it via the United States is an option. Enbridge, Canada’s largest pipeline business, told the BBC that it is “prepared to do whatever it takes to ensure North America’s and Europe’s energy security.” According to Louise Dickson, a senior oil analyst at the consultancy Rystad Energy, the impact of Canada’s additional supplies “will be relatively limited given the regionality of Canadian crude, which will likely remain in the North American market.” “The primary energy problem is unfolding in Europe as a result of supply constraints, and in Asia, where demand is on the verge of recovery if Covid-19 lockdowns are avoided,” Ms Dickson noted.
Confronting Rising Prices
Canada has joined the United States and the United Kingdom in imposing a ban on Russian oil. As a result, prices have risen to about $130 (£98.56) a barrel since the conflict in Ukraine began. Mr. Wilkinson believes there is “consensus” among the other energy ministers present at the summit that the world must be able to function without Russian oil and gas, adding, “I believe the main disagreements are over how quickly we can get away from it.”
JP Morgan, on the other hand, believes that the “present severe aversion to Russian oil” will diminish and that the price of a barrel of oil will return to around $100 in the second half of this year. The International Monetary Fund is among many who have expressed worry that rising oil prices are increasing the cost of products and energy bills and damaging the global economy through inflation (Josephs, 2022).
Mr. Wilkinson stated that governments must ensure that people “can heat their houses” and that industry can provide the commodities that everyone requires.
In the long run, Mr. Wilkinson acknowledged that “energy security and climate change mitigation are inextricably connected.”
In response to immediate worries, he contended: “Canadian oil displacing Russian oil does not result in an increase in global warming. There are no longer any CO2 emissions.” Mr. Wilkinson, who formerly ran a “clean energy” company, stated that he was a firm believer in the future use of hydrogen and other renewable energy sources to generate additional electricity.
Due to the unpredictable nature of solar and wind energy, Mr. Wilkinson stated that “there is a place for nuclear in many countries in terms of supplying baseload power rather than intermittent electricity.” Russia is a significant player in the worldwide nuclear energy business. Along with mining uranium, it also does much of the processing necessary to make it usable in power plants (Josephs, 2022).
Canada is “definitely” prepared to sell additional uranium, said Mr Wilkinson. He explained, “our uranium producers actually do have extra capacity and absolutely could ramp up to try to fill the gap that Russian supply will provide”. The UN Secretary-General didn’t mention a role for nuclear power when he warned a few days ago that the rush to consume fossil fuels because of the crisis in Ukraine is “madness” and undermines the ability to restrict the rise in global temperatures to 1.5C.
Mr Wilkinson said: “I think where the secretary-general and I would agree very substantially… is the need to expedite the work that we’re doing on climate change.\s” We are running out of time. There is no debate about it – we need to make great progress by 2030.” He argued that the crisis in Ukraine is underscoring “how vital it is not just from a climate viewpoint, although that’s enough, it’s from an energy security standpoint that we actually do this immediately. We don’t wait.” (Josephs, 2022).
Josephs, B. J. (2022, March 27). Canada pledges to help countries stop using Russian oil . Retrieved from BBC: https://www.bbc.com/news/business-60879685