PetroChina, Canada Ink Deal

Crude Investing News reports Canadian deal with PetroChina will enhance its edge as a producer of heavy oil.

Prices of light, sweet crude on the New York Mercantile Exchange are currently trading at half their peak hit in July last year. This has led some producers, including Royal Dutch Shell PLC, to postpone oil sands projects as they are capital-intensive and need crude futures above a certain threshold to be viable. US oil demand is also in the doldrums due to the global economic downturn, making it harder for producers to justify investments in new crude oil production.

While some suggest PetroChina’s investment in Canadian oil sands is opportunistic, analysts say it offers China’s largest-listed oil company several advantages.