Oilsands companies pull back on production as 'crisis' sector hits

With no immediate relief in a collapse in Canada, the oil sinks are beginning to turn down the taps and produce less oil.

Low prices for cholesterol and cholesterol are all over the world – from the oil majors, to the small service companies.

Cenovus announced on Wednesday it would limit its oil output by an unspecified amount, while Canadian Natural Resources followed on Thursday by stating it has already cut production by 15,000 barrels per day and could increase that figure to 55,000 this month December.

Canadian prices crashed in September because of a backlog of oil in Alberta. The Fort McMurray region has increased production throughout this year, but the United States is exporting more and more refineries in the United States.

The refineries will begin to operate in the future.

Jon Morrison with CIBC World Markets, quoted at a recent conference in Calgary, said, "You're going to have to shut up in production.

The amount of oil traveling by rail is increasing every day in Canada. In August, nearly 230,000 barrels were moved by trains, according to the National Energy Board.

According to Morrison, that figure has to reach 500,000 barrels by the end of the year for prices to improve. However, it expects it may only reach about 400,000.

"That still leaves you with too much crude," said Morrison. "Prices collapse in the production of supply and demand."

Cenovus CEO Alex Pourbaix is ​​challenging the rest of the oilpatch to do just that.

"The industry right now has a production problem," he said on a conference call with investors. "We are going to do our part, but we are not going to bear the industry on our back.I think this is something that has been dealt with on an industry-wide basis."

Several different grades of oil are produced in Alberta and they are all selling at lower prices compared to West Texas Intermediate, the North American benchmark. In October, heavy oil produced in Alberta, sold as Western Canada Select (WCS), was worth more than $ 50 less than a barrel of WTI.

With prices so low in Alberta, some companies say it makes financial sense to reduce the amount of oil sold on the market.

"Canadian Energy Resources", "Canadian Environmental Resources," "Canadian Environmental Resources," "Canadian Environmental Resources."

Canadian companies own refineries in North America and others have secured pipeline space out of Alberta.

"The unprecedented, wide heavy oil price differentials caused by this crisis for Canada," said Tom Whalen, president of the Petroleum Services Association of Canada, in a statement.

Industry experts expects high prices for Canadian heavy crude oil could persist into 2020.

More export pipeline space is expected to complete Enbridge's Line 3 replacement project is complete in about 12 months.