Quebec train crash: Will oil shipments by rail fall?

The Quebec train crash has sparked a flurry of emergency directives to increase railway safety, but there is no sign of shipments of oil by rail slowing as a result, Burgess writes. Indeed, the oil-by-rail industry is set to grow despite the catastrophic derailment, and amid a criminal investigation that has resulted in a raid on the offices of the train?s operator.

By James Burgess,?Guest blogger / July 29, 2013

Firefighters water railway cars the day after a train derailed causing explosions of railway cars carrying crude oil in Lac Megantic, Quebec.

Paul Chiasson/The Canadian Press/AP/File

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Canada?s heavy oil producers are reveling in a price rebound, but its spurred by increased rail shipments, shadowed by the tragic Quebec train crash that killed an estimated 47 people.

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On July 6, a runaway train jumped the tracks in Lac-M?gantic, causing a series of explosions that leveled the downtown core. This tragedy has sparked a flurry of emergency directives to increase railway safety, but there is no sign of shipments of oil by rail slowing as a result.

Indeed, the oil-by-rail industry is set to grow despite the catastrophic derailment, and amid a criminal investigation that has resulted in a?raid?on the offices of Montreal, Maine & Atlantic (MM&A), the train?s operator, on 25 July.

The Quebec disaster comes as Canadian heavy oil prices undergo a reprieve from the dark days of January, when it was trading at only 50% of the World Brent Crude price. For July, Canadian heavy oil has reached around 83% of World Brent crude prices, where it traded at over?$91 per barrel.?