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Economy

Minister Wilkinson’s flawed crystal ball

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4 minute read

From Resource Works

The federal minister of energy and natural resources’ statements are at odds with the energy industry’s leaders and economists.

Meet Canada’s new expert on the global oil-and-gas market, and the world’s  future demand for those commodities.

He is (surprise) Jonathan Wilkinson, Canada’s federal minister of energy and natural resources, who has announced this outlook for oil:

“Oil and gas will peak this decade. In fact, oil is probably peaking this year.”

The world oil market now eats up some 102.21 million barrels per day, so Wilkinson’s anticipated peak this year would be around that much.

But that’s not what market-watchers and oil-sector experts see:

  • Goldman Sachs Research: “While some prominent forecasters have predicted oil demand will peak by 2030, our researchers expect oil usage will increase through 2034. 

“That’s in part because of demand for oil from emerging markets in Asia and demand for petrochemicals. We think peak demand is another decade away.”

  • The 2024 outlook of OPEC, the Organization of Petroleum Exporting Countries (12 of the world’s major oil-exporting nations) says simply: “There is no peak oil demand on the horizon. 

“For oil alone, we see demand reaching over 120 million barrels a day by 2050, with the potential for it to be higher.”

“What the Outlook underscores is that the fantasy of phasing out oil and gas bears no relation to fact. Combined they make up well over 50% of the energy mix today and are expected to do the same in 2050.”

  • In an outlook for 2024-2050, one scenario from energy giant BP sees this: “Oil continues to play a major role in the global energy system over the first half of the outlook, with the world consuming between 100-80 Mb/d of oil in 2035.

“Oil demand declines over the outlook but continues to play a significant role in the global energy system for the next 10-15 years. This requires continuing investment in upstream oil (and natural gas).”

  • Greg Ebel, CEO of Calgary-based Enbridge, says global oil consumption will be “well north” of 100 million barrels per day by 2050 — and could exceed 110 million barrels.

“You continue to see economic demands, and particularly in the developing world, people continue to say lighter, faster, denser, cheaper energy works for our people. . .  And that’s leading to more oil usage.”

  • Even the optimistic International Energy Agency sees global demand increasing to 105.4 million barrels a day by 2030.

So take Minister Wilkinson’s crystal-ball outlook, of oil “probably” peaking this year, with at least a barrel of salt.

Then there’s Wilkinson’s contention that continuing to rely on oil and gas “will leave Canada uncompetitive and poorer on a go-forward basis.”

If so, why did his why his government invest $4.5 billion of your taxpayer money in 2018 to buy the Trans Mountain oil pipeline system and its TMX expansion?

Finance Minister Chrystia Freeland: “Because we knew it was a serious and necessary investment — one that is in the national interest and will make Canada and the Canadian economy more sovereign and more resilient.”

And from Prime Minister Trudeau: “By moving forward with TMX, we’re creating jobs, opening new markets, accelerating our clean energy transition, and generating new avenues for Indigenous economic prosperity. . . .

“This project isn’t about expanding our production. It’s about expanding our options. TMX will reduce our reliance on our single customer, the United States, and give us access to the growing markets of Asia.”

All of that seems to have escaped Minister Wilkinson and his flawed crystal ball.

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Business

Is Government Inflation Reporting Accurate?

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The Audit David Clinton's avatar David Clinton

Who ya gonna believe: official CPI figures or your lyin’ eyes?

Great news! We’ve brought inflation back under control and stuff is now only costing you 2.4 percent more than it did last year!

That’s more or less the message we’ve been hearing from governments over the past couple of years. And in fact, the official Statistics Canada consumer price index (CPI) numbers do show us that the “all-items” index in 2024 was only 2.4 percent higher than in 2023. Fantastic.

So why doesn’t it feel fantastic?

Well statistics are funny that way. When you’ve got lots of numbers, there are all kinds of ways to dress ‘em up before presenting them as an index (or chart). And there really is no one combination of adjustments and corrections that’s definitively “right”. So I’m sure Statistics Canada isn’t trying to misrepresent things.

But I’m also curious to test whether the CPI is truly representative of Canadians’ real financial experiences. My first attempt to create my own alternative “consumer price index”, involved Statistics Canada’s “Detailed household final consumption expenditure”. That table contains actual dollar figures for nation-wide spending on a wide range of consumer items. To represent the costs Canadian’s face when shopping for basics, I selected these nine categories:

  • Food and non-alcoholic beverages
  • Clothing and footwear
  • Housing, water, electricity, gas and other fuels
  • Major household appliances
  • Pharmaceutical products and other medical products (except cannabis)
  • Transport
  • Communications
  • University education
  • Property insurance

I then took the fourth quarter (Q4) numbers for each of those categories for all the years between 2013 and 2024 and divided them by the total population of the country for each year. That gave me an accurate picture of per capita spending on core cost-of-living items.

Overall, living and breathing through Q4 2013 would have cost the average Canadian $4,356.38 (or $17,425.52 for a full year). Spending for those same categories in Q4 2024, however, cost us $6,266.48 – a 43.85 percent increase.

By contrast, the official CPI over those years rose only 31.03 percent. That’s quite the difference. Here’s how the year-over-year changes in CPI inflation vs actual spending inflation compare:

As you can see, with the exception of 2020 (when COVID left us with nothing to buy), the official inflation number was consistently and significantly lower than actual spending. And, in the case of 2021, it was more than double.

Since 2023, the items with the largest price growth were university education (57.46 percent), major household appliances (52.67 percent), and housing, water, electricity, gas, and other fuels (50.79).

Having said all that, you could justifiably argue that the true cost of living hasn’t really gone up that much, but that at least part of the increase in spending is due to a growing taste for luxury items and high volume consumption. I can’t put a precise number on that influence, but I suspect it’s not trivial.

Since data on spending doesn’t seem to be the best measure of inflation, perhaps I could build my own basket of costs and compare those numbers to the official CPI. To do that, I collected average monthly costs for gasolinehome rentals, a selection of 14 core grocery items, and taxes paid by the average Canadian homeowner.¹ I calculated the tax burden (federal, provincial, property, and consumption) using the average of the estimates of two AI models.

How did the inflation represented by my custom basket compare with the official CPI? Well between 2017 and 2024, the Statistics Canada’s CPI grew by 23.39 percent. Over that same time, the monthly cost of my basket grew from $4,514.74 to $5,665.18; a difference of 25.48 percent. That’s not nearly as dramatic a difference as we saw when we measured spending, but it’s not negligible either.

The very fact that the government makes all this data freely available to us is evidence that they’re not out to hide the truth. But it can’t hurt to keep an active and independent eye on them, too.

1 After all, taxes are certainly a major part of our cost of living, right? And even though you could argue that tax payments deliver benefits like “free” healthcare, well transportation expenses also deliver benefits (like the ability to get to work).

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2025 Federal Election

Carney’s Hidden Climate Finance Agenda

Published on

From Energy Now

By Tammy Nemeth and Ron Wallace

It is high time that Canadians discuss and understand Mark Carney’s avowed plan to re-align capital with global Net Zero goals.

Mark Carney’s economic vision for Canada, one that spans energy, housing and defence, rests on an unspoken, largely undisclosed, linchpin: Climate Finance – one that promises a Net Zero future for Canada but which masks a radical economic overhaul.

Regrettably, Carney’s potential approach to a Net Zero future remains largely unexamined in this election. As the former chair of the Glasgow Financial Alliance for Net Zero (GFANZ), Carney has proposed new policiesofficesagencies,  and bureaus required to achieve these goals.. Pieced together from his presentations, discussions, testimonies and book, Carney’s approach to climate finance appears to have four pillars: mandatory climate disclosures, mandatory transition plans, centralized data sharing via the United Nations’ Net Zero Data Public Utility (NZDPU) and compliance with voluntary carbon markets (VCMs). There are serious issues for Canada’s economy if these principles were to form the core values for policies under a potential Liberal government.

About the first pillar Carney has been unequivocal: “Achieving net zero requires a whole economy transition.”  This would require a restructuring energy and financial systems to shift away from fossil fuels to renewable energy with Carney insisting repeatedly in his book that “every financial [and business] decision takes climate change into account.” Climate finance, unlike broader sustainable finance with its Environmental, Social, and Governance (ESG) focus would channel capital into sectors aligned with a 2050 Net Zero trajectory. Carney states: “Companies, and those who invest in them…who are part of the solution, will be rewarded. Those lagging behind…will be punished.”  In other words, capital would flow to compliant firms but be withheld from so-called “high emitters”.

How will investors, banks and insurers distinguish solution from problem? Mandatory climate disclosures, aligned with the International Sustainability Standards Board (ISSB), would compel firms to report emissions and outline their Net Zero strategies. Canada’s Sustainability Standards Board has adopted these methodologies, despite concerns they would disadvantage Canadian businesses. Here, Carney repeatedly emphasizes disclosures as the cornerstone to track emissions data required to shift capital away from “high emitters”. Without this, he claims, large institutional investors lack the data on supply chains to make informed decisions to shift capital to businesses that are Net Zero compliant.

The second pillar, Mandatory Transition Plans would require companies to map a 2050 Net Zero trajectory for emission reduction targets. Failure to meet those targets would invite pressure from investors, banks, or activists, who may pursue litigation for non-compliance. The UK’s Transition Plan Task Force, now part of ISSB, provides this standardized framework. Carney, while at GFANZ, advocated using transition plans for a “managed phase-out” of high-emitting assets like coal, oil and gas, not just through divestment but by financing emissions reductions. “As part of their transition planning, [GFANZ] members should establish and apply financing policies to phase out and align carbon-intensive sectors and activities, such as thermal coal, oil and gas and deforestation, not only through asset divestment but also through transition finance that reduces real world emissions. To assist with these efforts GFANZ will continue to develop and implement a framework for the Managed Phase-out of high-emitting assets.” Clearly, the purpose of this is to ensure companies either decarbonize or face capital withdrawal.

The third pillar is the United Nations’ Net Zero Data Public Utility (NZDPU), a centralized platform for emissions and transition data. Carney insists these data be freely accessible, enabling investors, banks and insurers to judge companies’ progress to Net Zero. As Carney noted in 2021: “Private finance is judging…banks, pension funds and asset managers have to show where they are in the transition to Net Zero.” Hence, compliant firms would receive investment; laggards would face divestment.

Finally, voluntary carbon markets (VCMs) allow companies to offset emissions by purchasing credits from projects like reforestation. Carney, who launched the Taskforce on Scaling VCMs in 2020, has insisted on monitoring, verification and lifecycle tracking.  At a 2024 Beijing conference, he suggested major jurisdictions could establish VCMs by COP 30 (planned for 2025 in Brazil) to create a global market. If Canada mandates VCMs, businesses especially small and medium enterprises (SMEs) would face much higher compliance costs with credits available only to those that demonstrate progress with transition plans.

These potential mandatory disclosures and transition plans would burden Canadian businesses with material costs and legal risks that constitute an economic gamble which few may recognize but all should weigh. Do Canadians truly want a government that has an undisclosed climate finance agenda that would be subservient to an opaque globalized Net Zero agenda?


Tammy Nemeth is a U.K.-based strategic energy analyst. Ron Wallace is an executive fellow of the Canadian Global Affairs Institute and the Canada West Foundation.

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