The oil and gas industry is one of the major contributors to Canada’s economy. However, the industry is no longer the same. There have been issues of high price and strict government regulations that have affected this industry badly. Though the price has dropped and the government regulations have changed, still the industry is unable to get back to its original state. Here are the major reasons why Canada’s oil industry is affected.
There is a huge demand for oil and gas across the globe. However, due to limitations of exploration activities, it is hard to find new energy sources. So, supply cannot meet demand. The price is still up and it’s creating a big problem for the oil and gas industries.
Lack of investment
The process of exploration, setting up production and refinery plants can be very expensive. Due to the high price of oil and difficulties in exploration, it is difficult to encourage investment.
Due to the carbon emission factor, many people are thinking of an alternative source of energy. So, in the future, oil may not matter to people anymore. They will shift to other forms of energy to protect the environment.
If the situation doesn’t change then the oil industry in Canada will be severely affected, and as a result, the county’s economy will see a downturn. The oil companies must find out a way to survive.