Impact of Crude Oil Production

Canada's Oil Production was seem to be affected by number of factors like Employment in Canada, Total Production Supply and Disposition of Crude Oil, Oil Price, GDP and CPI. So considering the statistical test performed on the model-6 I have identified Model-5 as the best outcome for the variable in consideration.

The main objective of this study has been to propose and to evaluate a model of the economic effect of Canada oil production. Our model presents downward trend in oil production for increase in oil price. We can conclude that this decrease in oil production for increase in oil price is due to many factors like the increase in oil price is not as significant to bring about increase in oil production, our analysis was for the period of 2000-2010 which had many economical shocks like war on Afghanistan , Iraq and great recession more over shift in supply curve to left as price increases brings about decrease in oil demand . While all other factors like total production supply and disposition of crude oil and GDP has positive effect on Canada oil production.

Overall, higher production and export of crude oil should provide a boost to the Canadian economy, both by offering high value added employment opportunities and raising national income through additional foreign exchange earnings.

1) Bayoumi, Tamim; Mühleisen, Martin. IMF Working Papers (2006) : Energy, the Exchange Rate, and the Economy : Macroeconomic Benefits of Canada's Oil Sands Production. Report WP/06/07

2) Washington, DC, USA: International Monetary Fund, (2006). p 18. (n.d.) Retrieved 11 28, 2012 from http://site.ebrary.com/lib/ucalgary/Doc?id=10380942&ppg=20

3)Salvatore, D. (Seventh Edition 2012). Managerial Economics in a Global Economy. Fordham University: Oxford University Press New York.

4)Statistical Data (n.d.) Retrieved 11 05, 2012 from CANSIM :

http://datacentre.chass.utoronto.ca.ezproxy.lib.ucalgary.ca/chasscansim