Renewables and fossil fuels are both being considered by Canada to fill the global energy gap

The global jump in oil prices, which has been compounded by the conflict in Ukraine, is seen by Canadian energy experts as a two-edged sword, pushing a rush to create renewable energy sources while also encouraging increased production of environmentally destructive fossil fuels. The balancing act is particularly tricky for Canada, a significant energy exporter with the ability to cover a portion of the vacuum caused by the growing banning of Russian energy sources.

Prime Minister Justin Trudeau and his left-leaning government have promised to invest heavily in renewable energy. The Alberta tar sands, however, are home to “the world’s most damaging oil operation,” according to National Geographic magazine.

Trudeau revealed a proposal to invest $9.1 billion by 2030 to cut carbon emissions by supporting electric vehicles (EVs), energy-efficient households and automobiles, wind and solar facilities, sustainable farming, and other initiatives at a speech in Vancouver in late March.

Trudeau told journalists at the time that “the leadership I talked about within Europe throughout the last few weeks were unequivocal.  They want to speed the energy shift to clean and green power, not only halt their reliance on Russian gas and oil.  Clean energy is a global priority, and Canada cannot manage to ignore it, he said.

However, in the short term, Trudeau’s long-term ambitions may be hampered by increased oil demand from Canada – the world’s 4th largest exporter – and renewed interest in Alberta’s tar sands, which have become much more lucrative than they have been in years. “The world can’t even afford to develop the Alberta tar sands, especially if we want to protect this planet for future generations,” Greenpeace Canada, an environmental group said last year.

With global oil costs as low as $50 per barrel in recent times, many companies have put plans to boost production on hold, owing to significant start-up costs that make the effort unprofitable. The heavy muck is now a lot more tempting now that oil prices have topped $100 per barrel.

“Higher oil prices would likely enhance demand in all oil resources, such as the Canadian oil sands,” said Mark Finley, who is a former CIA manager and analyst having an energy specialty. Currently, he works at the Baker Institute for Public Policy at Rice University. “Moreover, a growing focus in resilient supply chains, as well as what US Treasury Secretary [Janet] Yellen has dubbed ‘friend-shoring,’ will benefit Canadian producers,” Finley said in an interview.

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