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When even a Republican-dominated Senate can’t muster enough support to force the President’s hand, it’s a sure sign that environmentalists and other activist opponents of Keystone still dominate the pipeline decision-making process.

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While Canada’s dreams of exporting more oil sands production to the United States face a grim political environment, the economic environment looks even shakier. The price of West Texas crude dropped to $47.65 during trading Tuesday, and there was no reason to believe the oil price crash is near an end. At that price, Canada’s big pipeline plans could turn to pipe dreams.

The plunge in price of oil is more than just a surprise. This is what in official economic jargon is called an economic shock. Mostly, it seems to be a supply shock — brought on in part by the surge in U.S. shale production that in turn was created by technological change that is now sweeping the world.

Back in 2011, then Natural Resources Minister Joe Oliver told Washington that if Keystone were not approved, Canada had other options to “sell the oil elsewhere.” Oil industry officials blasted America with bravado: “OK pipe or lose our oil.”

Maybe that sounded tough in November, 2011, but since then the United States has emerged as the world’s fastest growing oil producer and the world’s largest oil producer.

When Mr. Oliver made his veiled threat to sell Canadian oil elsewhere, American oil production languished at 6,000,000 barrels a day, not far off its modern-day low. Then came the American shale oil revolution (See graph). In October, 2014, U.S. oil production hit 9,000,000 barrels a day, an increase of 50% over three years and one of the major causes of the current oil price crash. The U.S. oil output boom has also blown a big hole in peak oil theory, which has long dined out on the idea that the United States was a model for the theory on the grounds that U.S. oil output had “peaked” in the 1970s. That peak may soon be surpassed.