Keep the barrel, dump the crude? Oil has crashed below the cost of an empty barrel
Jameson Berkow, Reporter, BNN
Canadian oil sands producers struggling to make a buck from a barrel of bitumen would have better luck dumping out the oil and just selling the empty barrel.
Western Canada Select – the oil sands benchmark – has always been the lowest-priced grade of crude on Earth. With the better-known benchmarks of West Texas Intermediate and Brent barely able to maintain US$30 levels on a per-barrel-basis, WCS is at its lowest level ever: under US$17 per barrel and falling.
Buying an empty barrel, by comparison, will run about US$78.39 on Amazon. Assuming there are a bunch of empty barrels sitting around Alberta, this would seem to be a great, high-margin business model. Fill those empty barrels with some of the province’s ample freshwater supplies and – based on the average cost of bottled water at US$1.21 per gallon into a 55-gallon barrel – that value increases by US$66.55.
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