Canada's economic outlook tied to commodity prices
Courtesy Suncor Energy
Those willing to weather near-term volatility in favour of long-term growth might consider adding some Canadian energy companies to their portfolios, such as Suncor Energy, Canadian Natural Resources and Cenovus Energy.
Kim Inglis, Financial Post · Thursday, Dec. 9, 2010
Economists have been busy forecasting what’s in store for 2011. However, much of Canada’s economy is dependent on commodities, so the outlook for global energy becomes increasingly important and investors should think beyond 2011.
Near-term challenges in the world economy are numerous. Growth in several industrialized countries has lagged and fears of a double-dip recession abound. The hurdles of sovereign debt and rising unemployment must be overcome in order to reinstate steady growth.
While these issues are certainly troubling, the long-term energy outlook appears more favourable. In a recent report from the International Energy Agency, global energy demand is expected to increase 36% by 2035, averaging 1.2% per year. A whopping 93% of the projected increase in demand will be due to strong economic growth in the non-OECD, emerging countries.
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