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Oil hits seven-year highs as rally extends to a 7th week

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Oil prices surged to seven-year highs on Friday, extending their rally into a seventh week on ongoing worries about supply disruptions fueled by frigid U.S. weather and ongoing political turmoil among major world producers.

Brent crude rose $2.16, or 2.4%, to settle at $93.27 a barrel having earlier touched its highest since October 2014 at $93.70.

U.S. West Texas Intermediate crude ended $2.04, or 2.3%, higher at $92.31 a barrel after trading as high as $93.17, its highest since September 2014.

Brent ended the week 3.6% higher, while WTI posted a 6.3% rise in their longest rally since October.

The market’s surge accelerated in the last two days as buyers piled into crude contracts due to expectations that world suppliers will continue to struggle to meet demand.

U.S. jobs figures were surprisingly strong in January, despite the presence of the Omicron variant of the coronavirus.

Crude prices, which have already rallied about 20% so far this year, are likely to surpass $100 per barrel due to strong global demand, market strategists said this week.

Reflecting that bullish view, money managers raised their net long U.S. crude futures and options positions in the week to Feb. 1 by 6,616 contracts to 304,013, the U.S. Commodity Futures Trading Commission (CFTC) said.

Some, however, see risks to the rally. Citi Research said it expects the oil market to flip into surplus as soon as the next quarter, putting the brakes on the rally.

“A spike towards $100 crude should not be ruled out in the short run, but downside risks are plentiful, including Omicron setbacks on demand, economic growth concerns and financial market corrections as the central banks fight inflation,” said Bjørnar Tonhaugen, Rystad Energy’s head of oil markets.

Winter storms bringing icy conditions in the United States, particularly in Texas, also fueled supply fears as extreme cold could cause production to shut temporarily, similar to what happened in the state a year ago.

Tight oil supplies pushed the six-month market structure for WTI into steep backwardation of $9.06 a barrel on Friday, its widest since September 2013.

Backwardation exists when contracts for near-term delivery are priced higher than those for later months – and is reflective of near-term demand that encourages traders to release oil from storage to sell it promptly.

The number of U.S. oil rigs, an early indicator of future output, rose two to 497 this week, its highest since April 2020, energy services firm Baker Hughes Co said. [RIG/U]

Even though the oil rig count has climbed for a record 17 months in a row, the weekly increases have mostly been in single digits and production is still far from pre-pandemic record highs as many companies focus more on returning money to investors rather than boosting output.

Oil markets have also gained support from geopolitical risks as major oil producer Russia has amassed thousands of troops on Ukraine’s border, and is accusing the United States and its allies of fanning tensions.

The Organization of the Petroleum Exporting Countries and allies led by Russia, together known as OPEC+, agreed this week to stick to moderate output increases, with the group already struggling to meet existing targets and despite pressure from top consumers to raise production more quickly.

Iraq, OPEC’s second-largest oil producer, pumped well below its OPEC+ quota in January, while OPEC+ member Kazakhstan wants to keep more of its oil output at home to tackle rising fuel prices.

(Reporting by Stephanie Kelly in New York and Marcy de Luna in Houston; additional reporting by Rowena Edwards in London and Roslan Khasawneh in SingaporeEditing by David Goodman and Marguerita Choy)

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MEG Energy earnings dip year over year to $167 million in third quarter

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CALGARY – MEG Energy says it earned $167 million in its third quarter, down from $249 million during the same quarter last year.

The company says revenues for the quarter were $1.27 billion, down from $1.44 billion during the third quarter of 2023.

Diluted earnings per share were 62 cents, down from 86 cents a year earlier.

MEG Energy says it successfully completed its debt reduction strategy, reducing its net debt to US$478 million by the end of September, down from US$634 million during the prior quarter.

President and CEO Darlene Gates said moving forward all the company’s free cash flow will be returned to shareholders through expanded share buybacks and a quarterly base dividend.

The company says its capital expenditures for the quarter increased to $141 million from $83 million a year earlier, mainly due to higher planned field development activity, as well as moderate capacity growth projects.

This report by The Canadian Press was first published Nov. 5, 2024.

Companies in this story: (TSX:MEG)

The Canadian Press. All rights reserved.



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Eby wants all-party probe into B.C. vote count errors as election boss blames weather

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Premier David Eby is proposing an all-party committee investigate mistakes made during the British Columbia election vote tally, including an uncounted ballot box and unreported votes in three-quarters of the province’s 93 ridings.

The proposal comes after B.C.’s chief electoral officer blamed extreme weather, long working hours and a new voting system for human errors behind the mistakes in last month’s count, though none were large enough to change the initial results.

Anton Boegman says the agency is already investigating the mistakes to “identify key lessons learned” to improve training, change processes or make recommendations for legislative change.

He says the uncounted ballot box containing about 861 votes in Prince George-Mackenzie was never lost, and was always securely in the custody of election officials.

Boegman says a failure in five districts to properly report a small number of out-of-district votes, meanwhile, rippled through to the counts in 69 ridings.

Eby says the NDP will propose that a committee examine the systems used and steps taken by Elections BC, then recommend improvements in future elections.

“I look forward to working with all MLAs to uphold our shared commitment to free and fair elections, the foundation of our democracy,” he said in a statement Tuesday, after a news conference by Boegman.

Boegman said if an independent review does occur, “Elections BC will, of course, fully participate in that process.”

He said the mistakes came to light when a “discrepancy” of 14 votes was noticed in the riding of Surrey-Guildford, spurring a review that increased the number of unreported votes there to 28.

Surrey-Guildford was the closest race in the election and the NDP victory there gave Eby a one-seat majority. The discovery reduced the NDP’s victory margin from 27 to 21, pending the outcome of a judicial review that was previously triggered because the race was so close.

The mistakes in Surrey-Guildford resulted in a provincewide audit that found the other errors, Boegman said.

“These mistakes were a result of human error. Our elections rely on the work of over 17,000 election officials from communities across the province,” he said.

“Election officials were working 14 hours or more on voting days and on final voting day in particular faced extremely challenging weather conditions in many parts of the province.

“These conditions likely contributed to these mistakes,” he said.

B.C.’s “vote anywhere” model also played a role in the errors, said Boegman, who said he had issued an order to correct the results in the affected ridings.

Boegman said the uncounted Prince George-Mackenzie ballot box was used on the first day of advance voting. Election officials later discovered a vote hadn’t been tabulated, so they retabulated the ballots but mistakenly omitted the box of first-day votes, only including ballots from the second day.

Boegman said the issues discovered in the provincewide audit will be “fully documented” in his report to the legislature on the provincial election, the first held using electronic tabulators.

He said he was confident election officials found all “anomalies.”

B.C. Conservative Party Leader John Rustad had said on Monday that the errors were “an unprecedented failure by the very institution responsible for ensuring the fairness and accuracy of our elections.”

Rustad said he was not disputing the outcomes as judicial recounts continue, but said “it’s clear that mistakes like these severely undermine public trust in our electoral process.”

Rustad called for an “independent review” to make sure the errors never happen again.

Boegman, who said the election required fewer than half the number of workers under the old paper-based system, said results for the election would be returned in 90 of the province’s 93 ridings on Tuesday.

Full judicial recounts will be held in Surrey-Guildford and Kelowna-Centre, while a partial recount of the uncounted box will take place in Prince George-Mackenzie.

Boegman said out-of-district voting had been a part of B.C.’s elections for many decades, and explained how thousands of voters utilized the province’s vote-by-phone system, calling it a “very secure model” for people with disabilities.

“I think this is a unique and very important part of our elections, providing accessibility to British Columbians,” he said. “They have unparalleled access to the ballot box that is not found in other jurisdictions in Canada.”

This report by The Canadian Press was first published Nov. 5, 2024.



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Memorial set for Sunday in Winnipeg for judge, senator, TRC chair Murray Sinclair

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WINNIPEG – A public memorial honouring former judge, senator and chair of the Truth and Reconciliation Commission into residential schools, Murray Sinclair, is set to take place in Winnipeg on Sunday.

The event, which is being organized by the federal and Manitoba governments, will be at Canada Life Centre, home of the NHL’s Winnipeg Jets.

Sinclair died Monday in a Winnipeg hospital at the age of 73.

A teepee and a sacred fire were set up outside the Manitoba legislature for people to pay their respects hours after news of his death became public. The province has said it will remain open to the public until Sinclair’s funeral.

Sinclair’s family continues to invite people to visit the sacred fire and offer tobacco.

The family thanked the public for sharing words of love and support as tributes poured in this week.

“The significance of Mazina Giizhik’s (the One Who Speaks of Pictures in the Sky) impact and reach cannot be overstated,” the family said in a statement on Tuesday, noting Sinclair’s traditional Anishinaabe name.

“He touched many lives and impacted thousands of people.”

They encourage the public to celebrate his life and journey home.

A visitation for extended family, friends and community is also scheduled to take place Wednesday morning.

Leaders from across Canada shared their memories of Sinclair.

Premier Wab Kinew called Sinclair one of the key architects of the era of reconciliation.

Prime Minister Justin Trudeau said Sinclair was a teacher, a guide and a friend who helped the country navigate tough realities.

Sinclair was the first Indigenous judge in Manitoba — the second in Canada.

He served as co-chair of the Aboriginal Justice Inquiry of Manitoba to examine whether the justice system was failing Indigenous people after the murder of Helen Betty Osborne and the police shooting death of First Nations leader J.J. Harper.

In leading the Truth and Reconciliation Commission, he participated in hundreds of hearings across Canada and heard testimony from thousands of residential school survivors.

The commissioners released their widely influential final report in 2015, which described what took place at the institutions as cultural genocide and included 94 calls to action.

This report by The Canadian Press was first published Nov. 5, 2024.

The Canadian Press. All rights reserved.



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