Good morning, here's what the Oilman has for you today:

• Canadian Oil Sands Thrive Against All Odds

• Banks Can’t Quit Oil Cold Turkey: Barclays

• Tweet of the Day

Canadian Oil Sands Thrive Against All Odds

The Canadian oil sands have a reputation.

They’re dirty, ugly, and expensive…

Or so many thought.

It turns out that oil sand operators fetch higher values than shale drillers.

Hard work and a bit of luck

Oil sands production was expensive.

But operators have brought costs down—by 19% over the last five years.

Oil sands production was considered dirty.

But operators, pressed by regulators, worked on that, too.

Oil sands were also cheap.

But earlier this year, the Trans Mountain pipeline went into operation.

So now oil sands producers have an additional 590,000 bpd in offtake capacity.

And they are using it.

As a result of all this, the stocks of oil sands operators are doing better than shale stocks.

It is a genuinely unexpected development.

And proof that persistence pays off.

So does betting on the fundamental importance of reliable energy.

The most hunted oil industry in the world

Canadian oil companies operate in perhaps the most hostile environment.

Canada’s government has repeatedly demonstrated it does not like oil and gas.

It very loudly does not like them.

And it has worked hard to make life hell for oil and gas operators.

Red tape, emissions regulations, you name it, they’re doing it.

Yet the oil sands industry has managed to grow in this environment.

A true testament to industry resilience shale drillers can learn from.

Banks Can’t Quit Oil Cold Turkey: Barclays

The banking industry can’t just quit its business with oil and gas in a blink.

That’s according to Barclays CEO CS Ventakrishnan.

Banks are moving away from hydrocarbons, but it is happening gradually, he said.

And oil and gas will be with us for a long time yet to come.

Red flags flashing

The “reality is that for quite some time, fossil fuels will be with us,” Ventakrishnan told Bloomberg last week.

Not only that but “the glide path” to net zero will be longer than previously expected.

These admissions are the latest red flags along that “glide path.”

The move away from oil and gas is not going as planned.

It never could, but most, including Barclays, ignored it.

They were busy making net-zero pledges.

But it’s getting obvious that oil and gas remain the biggest fuel for the world.

Who else but bankers could be the first to change the tune?

The pushback begins in earnest

Barclays’ CEO is far from the only one daring to speak in this irreverent way about net zero.

The bosses of Citi, JP Morgan, and Goldman Sachs have all opened up recently.

They’ve all warned about the dangers of zero oil and gas.

KKR’s co-chairman and founder, Henry Kravis, went even further.

The PE billionaire activists love to hate told them they have no idea of the scale of the transition they are calling for.

He’s right, by the way. Activists don't know what it would take to get to net zero.

They don’t care, either.

But the people with the money care.

And they’ve had it with the activism.

Tweet of the Day

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