The left-wing New Democratic Party (NDP) surged to power earlier this week in Canada's oil-rich province of Alberta — the largest source of U.S. oil imports and planned origin point for the controversial Keystone Pipeline XL — on promises that included energy industry reforms.
The response to the Tuesday vote came swiftly: Canadian oil and gas shares tumbled and the country's main stock index hit a one-month low on Wednesday.
"Even now our inboxes are filling with messages expressing something between disbelief and dismay," Andrew Bradford, an oil analyst at Raymond James brokerage, said after the NDP ended the 44-year rule of the center-right Progressive Conservative Party.
Alberta's premier-elect Rachel Notley of the NDP moved quickly on Wednesday to assuage oil-industry worries after her party's victory, seen by many as an angry response to the impact falling oil prices have had on government programs, and what Slate called the "province's economic woes."
"I am hopeful over the course of the next two weeks they will come to realize that things are going to be A-OK over here in Alberta," said Notley, who will fill a similar role as that of a state governor in the United States.
Oil prices have fallen dramatically in the last year, from $100 a barrel to barely $50, and the conservatives dropped from 70 seats in the legislature to 10, CBC reported.
The NDP, once a marginal third party, is expected to be less accommodating to the energy industry. The party has said it will take another look at the amount of money the industry hands over to the province, so called royalties, according to MacLeans magazine. The party also plans to raise taxes on corporations and boost the hourly wages of workers.
Notley is also proposing tighter environmental regulations and reduced support for some pipeline projects such as Keystone XL project.
Alberta, the source of tar sands oil already flowing through pipelines across the United States, would be the origin point for crude that would move in TransCanada Corp's planned Keystone XL pipeline.
Environmental groups in the U.S. and Canada oppose the pipeline's construction, saying it endangers water resources and increases outputs of greenhouse gas.
Al Jazeera and Reuters