Canada loses quarter of crude output as result of wildfires
The massive wildfires in Canada’s oil-rich Alberta Province have resulted in a $760 million loss in oil sand production, according to a report by the economic think tank the Conference Board of Canada.
The report estimates the fire cut Canadian oil output by over one million barrels per day which represents about a quarter of Canadian output.
"These are big numbers," Kevin Birn, an analyst at IHS Energy, told the BBC, adding “the industry was already feeling the impact of a very low price environment in the first quarter of the year, with prices lower than in the rest of the world.”
He also said the oil sands firms affected were among the biggest energy companies in the world, and that they would be "pushing to get facilities up and running as soon as possible.”
The fire jumped a critical firebreak late Monday, covering 285,000 hectares. About 8,000 workers have been evacuated from the heavily forested northern part of Alberta province.
High temperatures and winds were working against firefighters and by Tuesday the uncontrolled blaze covered 355,000 hectares even though plants and trees had been removed to stop the fire spreading. The fire has destroyed a 655-room lodge for oil sands workers about 35 kilometers north of Fort McMurray in Alberta.
READ MORE: Canada wildfire curbs oil supply keeping prices stable
The reduction in crude supply caused by the Canadian wildfires and unrest in Nigeria where militants had attacked oil facilities continues to push oil prices towards $50 per barrel.
North Sea benchmark Brent was trading at $49.36 a barrel on Wednesday, which is its highest price since November. US West Texas Intermediate (WTI) crude reached a seven-month high of $48.55 per barrel.
