Oil prices will become more volatile after next year amid under-investment in production and uncertain growth in demand, Suncor Energy Inc. Chief Executive Officer Steve Williams said.
Crude prices will rise through next year and become more volatile for the following two to five years, Williams said at the Toronto Global Forum. Suncor can operate “successfully” with oil prices between $35 and $40 a barrel, he said.
The collapse of oil prices has forced Canadian and global producers to slash costs and curtail investment over the past two years. Even after a rebound from a 12-year low earlier this year, oil futures in New York are still about 60 percent down from their 2014 peak. Prices have been mostly stuck in the $40-$50 range for the past four months.
Canada’s oil reserves are “probably” the largest in the world and eventually there will be more competition to access them, Williams said.
Canada is close to getting an oil pipeline built, most likely Kinder Morgan Energy Partners LP’s Trans Mountain or TransCanada Corp.’s Energy East, the Suncor CEO said. The country has a reputation of not being able to get stuff done and is slowly making steps to reverse that, he added.