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Historic Price Crash Plunges Canadian Oil Patch Into Crisis

  • Unprecedented doldrums prompting companies to shut in output
  • Disaster is stark contrast to booming U.S. shale industry
Views OF Fort McMurray And The Oil Sands

Photographer: Brent Lewin/Bloomberg

Updated on

While the U.S. oil industry has hit a speed bump with the recent $20 drop in oil prices in New York, producers in Canada are in a full-blown crisis.

Heavy Canadian crude has been on a downward spiral since mid-May, with prices plummeting by more than 60 percent as an onslaught of new production from the oil-sands overwhelms the nation’s pipelines. In the past two months, the decline accelerated as many of the U.S. refineries that processed all that oil shut down for maintenance.