In Freight News 30/04/2015
Despite a drastic decline in oil prices, Canadian crude-oil exports hit an all-time high in January, according to Canada’s national energy regulator.
The rise in exports of Canadian crude comes as oil prices continue to face pressure from growing crude stockpiles and declining U.S. production. The U.S. oil price has skidded about 26% over the past six months and around 46% since last summer.
Canada exported 3.11 millions of barrels of oil a day in January, 12.8% higher than the same year-ago month and 80% higher than five years ago, according to figures from Canada’s National Energy Board.
The vast majority of Canadian crude exports head to the U.S. by pipeline and rail, with the U.S. Midwest continuing to be the biggest consumer of Canadian-sourced crude. Exports to the U.S. Midwest have nearly doubled to 2.0 million barrels of oil a day from 1.1 million barrels a day five year ago. Exports to the Gulf Coast refinery zone have also grown, to 365,000 barrels a day, or about three times the 2010-2013 average, as several pipeline projects were commissioned.
“[The U.S. Gulf Coast] holds significant long-term potential as a market for Western Canadian crude oil, particularly heavy grades,” the National Energy Board said.
According to the regulator, exports to non-U.S. destinations are fairly inconsistent, with some months seeing none at all. In the fourth quarter of last year, Canada exported about 30 million barrels of light crude and bitumen outside of the U.S., or about 1% of total exports.
While conventional oil production in Canada is expected to decline this year, crude sourced from Western Canadian oil-sands projects is expected to increase significantly, the regulatory said. Husky Energy Inc., Cenovus Energy Inc. and Canadian Natural Resources Ltd. all have major oil-sands projects that are expected to come online this year.
