Q: To what extent is the comparatively higher sell off in Canadian oil & gas producers attributed to Guilbault's promise to cap our Canadian production as a green initiative. How serious is this recent Trudeau government threat coming out of COP28 in Dubai? I hold TOU and CNQ but it is an energy general question.
5i Research Answer:
The sector continues to bear the brunt of political whims. The promise still needs to be reviewed, and we highly doubt any oil and gas companies nor investors are really surprised here. We would consider it serious but also already at least partly reflected in the sector's very low valuations. Essentially, the sector stock's are cheap because the world still hates carbon, and recent events just underscore this some more.