Capital spending in the oil and gas sector starts stronger in 2023
Spending was up by $2.1 billion (+26.8%) from the same period last year
By Siddhartha Bhattacharya, ATB Economics 2 June 2023 1 min read
National oil and gas spending started the year on a positive note.
Seasonally-adjusted capital expenditures in Canada’s oil and gas extraction industry reached $9.8 billion in Q1 2023, up 5.8% from the previous quarter.
Spending was up by $2.1 billion (+26.8%) from the same period last year and stood at the highest level since Q1 2018.
It is also interesting to note that energy companies retained a firmer stance on spending despite the recent tick down in oil prices.
The West Texas Intermediate (WTI) benchmark averaged US$76/bbl in the first quarter of 2023 vs US$83/barrel in Q4 2022 and US$95/bbl in Q1 2022.
Despite the significant headwinds that include volatile global energy market conditions, labour shortages and elevated cost pressures, we expect capital expenditures in the oil and gas extraction sector to improve in 2023 and 2024 but remain markedly below the high watermark for investment achieved in 2014.
Answer to the previous trivia question: Alberta accounted for 13% of total Canadian restaurant and bar sales in March 2023 (just a shade higher than our share of the national population).
Today’s trivia question: June has two “official” birth flowers. One is the rose. What is the other?