The increase in Canada's crude oil and refinery product exports, particularly in Northeast Asian markets, is occurring due to disruptions in Middle Eastern oil supply. Canada, especially its western region, has been recognized as a key supplier of crude oil and LPG.
Crude Oil Production in Western Canada
Crude oil production in Western Canada decreased in August due to maintenance work at oil sands facilities. However, the Christina Lake facility from Cenovus Energy with a capacity of 360,000 barrels per day, Firebag from Suncor with a capacity of 231,000 barrels per day, and McKay River with a capacity of 38,000 barrels per day will soon return to production.
Challenges and Opportunities in Infrastructure
The main limitation for Canadian producers is oil transportation capacity. Ongoing and planned optimization projects aim to reduce this bottleneck over time. Cenovus Energy expects to increase its crude oil production to over one million barrels of oil equivalent per day and has raised its forecasts for 2026 by 25,000 barrels per day. Additionally, the Blackrod Phase 1 project from International Petroleum, with a capacity of 30,000 barrels per day, was commissioned in May and is expected to reach its full capacity by the end of 2027.
Exports of Refinery Products and LPG
Canadian refinery exports in 2026 will largely be influenced by the market, and due to scheduled maintenance, refinery product exports from Canada's East Coast will decline. The Irving Oil refinery in Saint John, with a capacity of 320,000 barrels per day, will be shut down for maintenance until mid-November. Furthermore, LPG exports, particularly propane, are expected to increase from Canada's West Coast due to demand from China, and are anticipated to reach approximately 55,000 barrels per day with the commencement of operations at the Ridley Island Energy Export Facility in late 2026.
Ultimately, crude oil and propane exports from Western Canada are expected to rise, especially with the implementation of upstream and midstream projects. In the short term, downward pressure on Canadian crude oil differentials and increased production should facilitate marine crude oil exports from Western Canada.
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