West Texas Intermediate

It’s hard to see a structural recovery in natty gas prices.

Lower WTI prices mean slower pipeline construction and more pressure on crude-by-truck.

The pipelines taking oil away from the Permian are at capacity, causing a buildup of WTI inventory at the Cushing, OK storage sites and depressing the price of WTI against Brent. Prices would be even lower if Venezuela and Iran weren’t causing further worries about global supply.

We see falling demand for oil, lumber, and wheat out of Canada in the future due to a combination of market forces. Canadian Pacific Railroad appears to be especially exposed to this freight recession.