Oil prices soar
April 9, 2025
By Tiphanie Roquette
Oil prices rose sharply on Wednesday after the United States announced a 90-day pause on punitive tariffs affecting multiple countries. The benchmark price of West Texas Intermediate (WTI) crude surged from around $55 to $62 per barrel within a few hours—an abrupt rebound that hasn’t been seen since the pandemic years, according to Martin King, director of North American energy market analysis at RBN Energy.
Despite the jump, prices remain several dollars below their levels from a week ago, before the initial tariff announcement triggered declines across financial markets. King noted that a full return to stability may take weeks due to the ongoing tit-for-tat tariffs between the U.S. and China. He emphasized China's outsized influence on global oil markets—not only through its massive imports (around 11 million barrels per day in 2024) but also through the broader perception of its economic health.
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In Canada, the impact has been more muted. King pointed out that the Canadian oil industry—particularly oil sands producers—is built to weather volatility, with low operating costs following initial investments. A price of $55 per barrel, he said, would only slightly affect production growth plans.
Cenovus Energy CEO Jon McKenzie echoed this sentiment, highlighting that the industry has focused on low debt, efficient capital structures, and global competitiveness. While the recent price jump provided a short-term boost, companies like Cenovus are cautious in response to ongoing volatility.
Tourmaline CEO Mike Rose acknowledged a significant dip in the company’s stock—down over 17% before recovering 5%—and expressed concern, though he noted it’s too early to determine whether the issue is short-, medium-, or long-term.
Tristan Goodman, president of the Explorers and Producers Association of Canada, reinforced the sector’s resilience, stating that Canadian producers can remain profitable even at $50 per barrel, unlike many U.S. producers in the Permian Basin who require at least $65.
According to a report by Enverus, while existing projects can continue at current prices, launching new developments would need sustained prices of $80 or more. King also pointed out that the narrowing price gap between Canadian and U.S. oil, along with a weaker Canadian dollar, is helping shield Canadian firms from international market swings.
Alberta Premier Danielle Smith added that the province’s budget is based on WTI at $68 per barrel, with each $1 drop translating to a $750 million revenue loss. However, she said there’s no need to panic over short-term volatility, citing previous experience and built-in fiscal contingency planning.
