As we metaphorically climb the steps, and tentatively knock on the Halloween energy door, there seems to be much to fear in the trick department — and little to look for, let alone find, in the treat part of the loot bag.
This former magical night has become an evening of sleight of hand. A shell game — now you see it, now you don’t! This applies particularly to the oil patch and ultimately the Canadian consumer.
The pandemic has corroded demand for all refined petroleum products to the point that, in the supply/demand equation, there is none of the latter. This is bad news for the downstream side (refining and marketing) of the oil industry, which has, by upward osmosis, leaked under the corporate doors at the head office level.
At the time of writing this report, Suncor Energy reported at Q3 loss of $302 million versus a $1.1 billion profit in the same period in 2019. Now you see it, now you don’t!
Prior to this earnings update, Suncor announced that its offices flying the Petrocan banner, and housed in the rarified atmosphere of Toronto, would be moving to a wide choice of office space in Calgary. The 700 employees were, however given the option to take it or leave it.
It may be of interest to En-Pro’s on-road diesel customers and consumers in general that the locations of the Toronto offices were home to the company’s management and day-to-day operation of its vast national card lock network, in addition to its coast to coast chain of retail gas service stations.
In another development that may be cause for pricing concern in the transport sector, is this week’s “friendly,” merger/buy-out of Husky Energy by Cenovus.
I find it hard to believe that when one company buys another it seems to the public just a friendly, “Oh come on now, give me a hug!” time for all concerned in the mergerthon
You say merger, I say buy-out. Potehto, Potahto!
Yet, in a blink of the eye, the newly “merged” head office management, just one day later declared that they would be reducing their resultant employment overload by 25% affecting 8,600 employees. That’s one big potato soon to be fried, employees may ponder.
The Suncor (Petrocan) and Cenovus moves are considered consolidations of operations.
In both cases, I can only see a dramatic reduction in purchasing options for diesel consumers since consolidation means cost reductions, which will lead to evaluations and cost justification of individual cardlock and retail gasoline facilities.
I can easily foresee a 20% cutback in the Petrocan branded sites and the Husky sign soon becoming a collector’s item for sale on eBay
There is a distinct possibility that Parkland Industries, that currently runs or operates all the Esso, Shell, and Ultramar facilities, may become the only operator and/or purchase option in the diesel market in this country.
That’s no trick, nor will it be a treat.
– Roger McKnight – B.Sc., Senior Petroleum Analyst