HOUSTON \u2014 Jim Mattis, the retired U.S. marine general and Donald Trump\u2019s first defence secretary, left a rapt audience at CERAWeek with this parting advice: Watch your assumptions like a hawk.\u00a0<\/p>\n
A significant percentage of the 11,000 people who attended S&P Global\u2019s annual energy extravaganza filled a hotel ballroom on March 23 to watch Mattis talk with S&P Global senior vice-president Carlos Pascual and Suzanne Maloney, an Iran expert at the Brookings Institution, about the biggest energy story in the world.\u00a0<\/p>\n
Mattis, who resigned after two years in the first Trump administration, had already punctured any remaining assumptions that the U.S.-Israeli war on Iran would leave the world in a better place. \u201cIf we were to declare victory and basically pull out our armada, the number of forces we\u2019ve sent there, [Iran] would say, \u2018We now own the Strait,\u2019\u201d Mattis said.\u00a0\u00a0<\/p>\n
In other words, the best-case scenario would leave Iran in a position to administer some kind of toll on the oil, natural gas and other commodities that pass through the Strait of Hormuz. The other possibility\u2014escalation\u2014would be more of what the world has been watching since Feb. 28, only worse. Neither scenario suggests oil and gas prices will be returning to prewar prices anytime soon. The polycrisis<\/a> rolls on.\u00a0<\/p>\n It\u2019s a bad idea to cling to old notions when everything is coming undone. Mattis advised the business leaders in the room to hire someone to stress test every assumption on which their strategies were based; he shared that he used to have an aide from the CIA who kept him honest. \u201cCheck your assumptions very closely [during] this time, because they can give you a pathway into some really bad decisions when you are in this crisis mode right now,\u201d he said.\u00a0\u00a0<\/p>\n What assumptions might Canada have wrong? Probably too many to tally in one go, so let\u2019s narrow the focus to the issue of the moment.\u00a0<\/p>\n Even before the Iran war, Prime Minister Mark Carney, Alberta Premier Danielle Smith and other leaders were talking freely about Canada as an energy superpower. Practically every Canadian at CERAWeek\u2014and there were a lot of them\u2014described the real-time geopolitical shift to energy independence as an opportunity. \u201cAlberta really is a powerhouse when it comes to energy,\u201d said Brian Jean, the province\u2019s energy minister. \u201cAll we need to do is get it to market.\u201d\u00a0<\/p>\n All we need to do is get it to market.\u00a0<\/p>\n The assumption for years has been that the only thing standing between Canada and superpower status was its aversion to stringing pipelines across undisturbed wilderness. That aversion has softened considerably since Carney became prime minister a year ago. Yet the federal and Alberta governments missed<\/a> their April 1 deadline to clear a regulatory path for a new pipeline to the West Coast.\u00a0<\/p>\n Why? It isn\u2019t a lack of opportunity. Mark Maki, chief executive of Crown-owned pipeline company Trans Mountain, said at the conference that China and India \u201clove\u201d Alberta\u2019s heavy oil. My guess: the delay is rooted in the political class\u2019s assumption that profit-seeking enterprises would be keen to chase that opportunity and join the Big Leagues. The revealed preference<\/a> of the five oilsands behemoths<\/a> who would fill any new pipeline suggests they are only moderately interested in making the jump to superpower status. They have it too good being merely powerful, so why change?<\/p>\n