From The Globe:
Crude oil consumption in the Organization for Economic Co-operation and Development countries dropped last year for the first time in 20 years as a result of the aggressive actions by many of those nations to reduce greenhouse gas emissions, according to CIBC World Markets Inc.
Rubin anticipates that the provinces and states will put a cap on carbon dioxide emissions while at the same time establishing an emissions trading system that would allow bigger polluters to buy emissions credits from other firms that are emitting less than they are allowed under the cap.
In CIBC's January World Markets Outlook release, Rubin argued that:
"What investors have to be wary of is not the future direction of oil prices, but what the eventual net backs to oil producers will be in a carbon-regulated environment [...] While we know that oil sands producers will have to be huge purchasers of emission credits, we don't know what the market-clearing price for those credits will be.
"The experience of the over decade-long functioning CO(2) and NOx-emission trading systems in the U.S. reveals that over time the market price for emissions credits rises sharply as emission caps are gradually lowered. Depending upon how stringent the cap, the real investment risk is that much of the economic rents from rising oil prices may be diverted from shareholders of oil producers to owners of much-sought-after emissions.
For this reason, Rubin is now suggesting that investors lower their exposure to oil.
Since the Harper government does not seem willing to join an International emissions trading market, let's assume a Canada wide version. This map shows historical and projected Carbon emissions by region. And here's a hint. Get outta Calgary, move to Montreal, and watch the sky for airplanes dropping oil-patch money over the city.
The best part of it is that, since the U.S. is heading in the same direction (perhaps even more swiftly than Canada), Alberta won't be able to evade their responsibilities by separating, unless they have the whole province towed over to China.