6 Canadian oil won’t plumb 2018 lows he Alberta government’s remarkable intervention in the oil sector at the end of 2018 will carry over into the Tnext 12 months and beyond. 1.2 million Having first agreed to buy 7,000 railcars, the province then announced pro- barrels/day: OPEC’s duction cuts to clear bloated inventories and help the price of Canadian oil production cut, which move closer to global benchmarks. But these actions won’t have any impact on global prices as that responsibility lies in large part with OPEC, which on should help oil prices December 7 announced plans to cut production by 1.2 million barrels per day to boost oil prices. Lower global supply means the market will get closer to balance in 2019. This is good news for Canadian producers as well, given that the spread between WTI and Western Canadian Select is also moving in a positive direction. The price gap between Canadian and international oil 50 $US per barrel 40 Differential between WCS and WTI 30 price, in US$ per barrel 20 10 0 2010 2012 2013 2014 2015 2016 2017 2018 Source: Bloomberg, RBC Economics Research RBC Economics Research | Navigating 2019 - 9 big insights for the year ahead | January 2019 16