What if Peter Hall is right again? Then the worst is over, at least for the energy side of the global economic slide.

“Commodity prices have bottomed,” Hall told an oil markets conference held by the Canadian Energy Research Institute. By the time of the annual spring event, oil revived into a trading range of around US$50 a barrel from winter lows in the $30s.

By Hall’s standards, his 2009 expectations are high. In May 2008, when the price was $122 and still leaping towards $150, he stood out as a rare bear. He rejected the theory spread by celebrity experts who are now all but forgotten, such as the former chief economist for CIBC World Markets, Jeff Rubin, that oil had learned to fly.

In the midst of the ’08 excitement, Hall startled audiences in Edmonton and Calgary by calling $100-plus oil just part of a financial bubble that was bound to burst. “We’re at a dangerous point in the world business cycle,” he warned at the time. “Risks are elevated. They are about as elevated as they ever get.”

As economics chief of Export Development Canada, Hall has an advantage. His role makes him keep his feet on the ground. He is not employed to tout shares or theories. He works for a federal Crown corporation set up like an old-fashioned conservative bank, emphasizing prudence and responsibility. EDC finances international ventures with public money, has a mandate to run in the black, and needs reliable advice on odds that its loans will be repaid.

In 2009, as in ’08, Hall again sounds like his counterparts at oil, gas and power companies, who are often wary combination engineer-economists that never enhance their careers by making exuberant predictions. Energy will only hold its steady course if the rest of the economy avoids sinking deeper, he says: “You’re seeing multiple bubbles bursting all over the place. We are in uncharted waters.”

The fifth and potentially worst wave in a disastrous series is poised to break, Hall warns. First the housing bubble burst in the United States. Second, the credit crisis developed as bad real estate loans sank the financial sector. Third, consumer spending fell. Fourth, layoffs spread. And now fifth comes a second round of financial defaults. Failures will accelerate if employment and consumer spending keep on shriveling, rendering formerly reliable borrowers unable to make mortgage, credit card and business loan payments. “This is what keeps me up at night,” Hall says.

The mood is a similar blend of wary hope at notable contrarian Imperial Oil Ltd., which like majority owner ExxonMobil Corp. is bucking the 2009 industry trend by raising its budget. Canada’s senior oil giant still uses a 25-year forecast of healthy growth in fossil fuel production and consumption. But it’s no promise that fat times are just around the corner. “It’s a long-term outlook,” says Imperial energy analysis manager Jim Hughes, veteran of a quarter-century in the firm’s corporate planning. “It’s not a detailed projection of the next five years.”

Gordon Jaremko