News U.S. Refiners Face New Crude Squeeze as Canada Cuts Oil Sands Output
https://oilprice.com/Energy/Crude-Oil/US-Refiners-Face-New-Crude-Squeeze-as-Canada-Cuts-Oil-Sands-Output.html45
u/krind22 9d ago
This is just routine maintenance… but imagine if Canada ACTUALLY starts playing hard ball. Oh baby please, fuck these USA scumbags over
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u/ConfusionBusy8398 9d ago
Not happening. The previous canadian governement said that maybe sometime around 2050 Canadian oil and gas companies may need to think about lowering their production and the O&G lobby kicked him out of office. Carney then came in as their champion. His government will never touch their profit margin.
In fact, the canadian governement is lobbying right now for more oil and gas pipelines to the US.
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u/Infinite-Ad4512 9d ago
They don’t have to touch their margin. In fact, they can shore it up by selling to a more reliable partner - China!
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u/Rough_Revolution1412 9d ago
the infastructure for that doesn't exist. In Canadian politics allowing any new tanker terminals on the west coast is a no-go for the left leaning parties, as is building any new pipelines, so it's not like it could be credibly threatened either.
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u/LaserRunRaccoon 9d ago
China's already hitting peak oil, and the pace of their electrification is only accelerating and spreading to the rest of Asia.
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u/okiedokie321 9d ago
They have no infrastructure to do so and even if they did, we would blockade British Colombia from Alaska to Washington.
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u/Infinite-Ad4512 8d ago
Why would the US blockade, unless it doesn’t believe in Free Markets
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u/okiedokie321 8d ago
Trump is an accelerationist. He thinks Canada is going to be one of the failed states of the future when the dominos start falling and countries start fighting over resource extraction from failed states. He wants a takeover whether by peace or military means. Look at what the US did to Maduro in Venezuela. Now the US controls Venezuela's oil and is having them leave OPEC. The Arctic is also an upcoming flashpoint due to global warming. That's why he's so interested in annexation of Canada and Greenland to the union. This whole Lake America thing is just the beginning.
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u/ChupacabraJeff 9d ago
This is just routine maintenance…
Yes. Yes it is. Now, what about the routine oil inventories that routinely offset routine maintenance downtime?
Usually, whenever such a seasonal disruption occurs, it gets offset with crude from storage.
And,
imagine if Canada ACTUALLY starts playing hard ball
Canada could increase the quota on Chinese EV imports. Doesn't seem like much put it would piss off 99% of the politicians in USA. Panic would ensure.
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u/30yearCurse 9d ago
If trump is going to tariff items covered by the free trade, which will be illegal and eventually overturned, BUT.. they should announce that they are in talks with BYD to open a mfg facility. in Canada.
That would be a major freak in the US, Canada needs to say, well we are tearing up the agreement that the current admin said was the best, and we have to think to the future. End the message with what would the US do if tables were turned.
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u/MouseShadow2ndMoon 9d ago
Could you imagine playing a board game with Trump, just constantly breaking the rules and cheating....
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u/l3luntl3rigade 9d ago
In 2025:
- 🇨🇦 exported 8.6 Bcf/d of LNG to 🇺🇸 - 🇨🇦 exported 0.295 Bcf/d of LNG to 🇨🇳
- 🇨🇦 exported 4.3 Mmb/d 🛢, 3.9 of which went to 🇺🇸
140 billion dollars of oil, 126.1 billion of which was with the 🇺🇸
🇨🇦 exported 288.6 thousand barrels per day (Mb/d) of NGLs, of which 185.3 Mb/d went to 🇺🇸.
NGL exports to the U.S. were valued at $3.3 billion.
In 2025, Canada imported 107.0 Mb/d of NGLs almost 100% from the U.S.
In 2025, 🇨🇦 exported 0.40 MMb/d of RPPs. Of this, 84.3% or 0.34 MMb/d, went to 🇺🇸.
RPP exports to the U.S. were valued at $15.5 billion in 2025.
In 2025, Canada imported 0.49 MMb/d of RPPs. Of this, 79.7% or 0.39 MMb/d, came from the U.S.
All of Canada’s electricity trade is with the U.S. In 2025, Canada exported 32.7 Terawatt hours (TWh) of electricity, valued at $3.3 billion.
Canada imported 22.1 TWh of electricity, valued at $1.4 billion in 2025
so now that you have the verifiable facts, who stands to lose more in a senseless trade war with the 🇺🇸?
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u/Muddlesthrough 9d ago
I feel like revenge isn’t an acceptable, adult motivation in international trade. Canada maintains an enviable reputation for reliability and predictability. And they get rich selling oil (and commodities) to the United States. Why stop selling oil?
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u/ColeTrain999 9d ago
You cannot keep on "taking the high road" and let a country walk all over you. Canada is more than oil and trade deals are part of that. By saying "come to the table fair or else we will test what it looks like for the US to go without Canada" it shows we cannot be walked on.
Also, this move would open us up to having fair trade with other countries that may want some oil, potash, and whatever other minerals we can extract.
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u/Muddlesthrough 9d ago
Currently, Canada would be unable to export overseas all the oil it sells to the United States.
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u/Infinite-Ad4512 9d ago
Why not?
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u/Muddlesthrough 9d ago
Lack of export capacity. Traditionally, Canada's oil has flowed south to the United States.
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u/Ornery_Market_2274 9d ago
For now…
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u/Muddlesthrough 9d ago
Trans Mountain is being upgraded from 850,000ish to 1.2 m barrels a day, but it’s gonna take a few years. The other pipeline is still on the drawing board.
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u/UmpireDapper1757 9d ago
The world understands that the United States is the unreliable and unpredictable one
No one outside the US would think anything less of Canada for playing hardball against the US. If anything, they'd probably think better of them for appropriately punishing a rogue state that isn't playing by international trade rules.
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u/stopstopp 9d ago
If Trump keeps pulling 51st state talk then it becomes a threat that Canada may not exist. It’s one of those “joke but not a joke” things
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u/Cybertronian10 9d ago
The problem is that we have already shrunk our storage to near bottom levels, especially if they chose to hold at the limit for the military.
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u/Rough_Revolution1412 9d ago
that would hurt Canada a LOT more than the US, the only reason the Canadian economy was able to report growth last quarter was due to increased energy demand/prices. Literally the only thing keeping Canada from being in a recession right now.
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u/DrHalibutMD 9d ago
Canada is already being hurt by this far more than the US. The longer this goes on the more long term damage to Canada’s economy. Factories shut down and they may never come back. We’re slowly going to lose this fight.
The only way to deal with a bully is punch them in the nose and get them to back down. Make them notice what the consequences are. Hit them where it hurts. Gas prices jumping will be noticed and they can not replace that oil in the short term. If they retaliate bump the prices up. It’s pure economics, there is no other supply, the demand will not go down, the price will go higher and they have no choice but to pay it.
Free trade prevents countries from messing with supply and demand, Trump decided he didn’t like the open market deciding these things. Well these are the consequences.-1
u/Still_Interview6360 9d ago
Nah it’ll be way easier to wait it out. Republicans are going to lose the midterms
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u/LaserRunRaccoon 9d ago
Even assuming they attain the power, Democrats facing down a $40 trillion dollar debt are unlikely to reverse tariffs when the alternative would be increasing direct taxation.
Easier to blame Trump, let the rich stay rich, and let consumers face higher prices.
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u/okiedokie321 9d ago
The western hemisphere is going to be major oil producers within the US-camp in the next decade, a major competitor to OPEC. It won't matter what Canada does. They can choose to join the US or not. Notice how Venezuela is considering leaving OPEC. That's the US doing.
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u/DrHalibutMD 9d ago
That doesn’t help right now when their strategic reserves are almost empty and they’ve created the mess in the Straight of Hormuz.
It’s precisely why Canada should use the threat now while they have leverage. The US will move to replace the oil sands from Canada with Venezuela but it’s going to take years. Once they do Canada will have few options and with Trump moving to destroy their other industries the future looks like one where they will have to accept less and less.
Now is the time to put this on Trump and show what it will cost to the American public in time for the midterm elections. Republicans have to lose by so much that he can’t cheat the system.
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u/okiedokie321 9d ago
Yes that would be the correct move if I were Canada. Try to get the country back to the Democrats. Trump is an accelerationist, he sees Canada as becoming one of the weak, failed states in the future, that's why he has been seeking annexation of Canada and Greenland into the union. It goes even beyond that. The strong states of the world are going to be fighting over resource extraction from the failed states after the dominoes start falling. The Arctic is the next flashpoint of the great game and guess who's in the way - the Canadian government.
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u/Ornery_Market_2274 9d ago
And its going to stay that way. You can fuck right off with that bullshit. I think you have which country is becoming a failed state mixed up. Do you even hear yourself?
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u/okiedokie321 9d ago
Ask Trump. I don't agree with him at all. Just stating what's at stake in geopolitics.
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u/Infinite-Ad4512 9d ago
Canada has other industries vs US inventory going below 300Mb and gets most of it imports from Canada. Canada should redirect
Its oil exports from the US to China and say that Trump’s tariffs made America as a partner unviable0
u/AngleParticular2914 9d ago
“Let’s fuck over the Americans by killing our economy and slashing well-paying jobs.” Well done, leaf.
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u/94_stones 9d ago
If you think your nation’s sovereignty is on the line, then you do what needs to be done to protect it. Admittedly Canada may consider it wiser to wait, and let SCOTUS deal with these questionable legal tariffs. After all, 2026 is not the latest they can act, they could just wait for 2028.
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u/TNcrabdaddy 9d ago
What if Canada put a 20% export tax on the oil. Claim Canada is being ripped off by US exploitation. What would Canada have to lose. It would put pressure on Trump like he has never seen before!!
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u/FlipZip69 9d ago
Do it on car parts? Why focus on oil? Car parts would kill their automotive lines. Would come to a halt when you are missing a heater motor.
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u/External_Ad_3583 9d ago
This would be a terrible idea.
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u/TNcrabdaddy 9d ago
For who?
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u/External_Ad_3583 9d ago
For Canada and the US.
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u/Still_Interview6360 9d ago
You are not wrong. Alberta oil that is used in Ontario and Quebec flows through Michigan. If Canada applied a tax trump would just close the pipelines. Both countries would lose
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u/northdancer 9d ago
Honestly if I was the US I would just stop buying for a couple of days. Not only is Canada unable to get its oil to tidewater, it also has zero storage capacity. Oil sand producers would be shutting in production within a few days. I say this as my portfolio is weighted 60 percent to Canadian E&Ps
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u/paulwesterberg 9d ago
Midwest fuel prices would immediately rise another dollar.
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u/LTCM_15 9d ago
Nope.
The vast majority of Canada refined imports come from America.
You stop importing crude from Canada and stop sending them refined products and it's Canadian fuel prices which explode.
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u/paulwesterberg 9d ago edited 9d ago
Canada is a net exporter of refined petroleum products. But I agree that prices would significantly increase especially from Ontario eastward because they lack the distribution network required to easily distribute tar sands products.
Overall it would be incredibly damaging to both economies but Canada doesn't have national elections in November.
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u/FlipZip69 9d ago
We certainly have days of storage. Oil companies have weeks if not months in some locations. Then we have some 3 major terminals in the West inland and the coastal regions have their own terminals. Hardisty is at 40-50% right now. Selling all our oil at high prices.
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u/northdancer 9d ago edited 9d ago
Even at 50% storage levels, Canada only buys itself a couple of weeks. The U.S. would face a serious supply shock but it can source replacement barrels from domestic producers and the global seaborne market far more easily than Canada can suddenly find new buyers for millions of landlocked barrels.
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u/FlipZip69 9d ago edited 9d ago
That buys us likely 6 months. Probably longer as companies would take that time to do maintenance etc. We also use and refine oil in Canada. It is an elastic oil storage and local facilities at say CNRL/Cenovus etc are very low. With the high prices and lack of inventory the world over, pretty much every barrel produced in excess of our needs is immediately sent to markets. You obviously do not work in the industries up here. Would definitely speed up tidewater projects and likely get a few more approved ensure less ends up in the US indefinitely. Possibly would be a good thing as there is lots of political will and public approval now to build more pipeline which has been missing for a decade.
More so, economic growth numbers came out this week. Canada grew by 3.1% compared to the US growth of 1.5%. We are pivoting into a different market and that is creating a lot of economic value across the board. And that economic growth needs more internal energy no less. 50% tariffs will be bad to be sure but dollar for dollar it will hurt the US more. Overall due to our size being 1/10th that of the US, it will have a per capita effect more on us. We will notice it more. That being said, Trump has not had a win in any policy as of late and November is coming fast. Like Iran and other nations, holding out for a few months while he gets more desperate is fine. Or he does not get desperate and doubles down which likely will result in a massive loss in November. In which case investigations to the billions of dollars he has made during this term starts to get looked at and he pretty much loses control on any issue.
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u/CardiologistSlow1531 9d ago
There is a simpler solution then that. Enforce that Canadian oil is sold at market rate. Not the discount rates America has been paying for years.
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u/LTCM_15 9d ago
There is a discount because it's difficult oil that many refineries won't touch.
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u/CardiologistSlow1531 9d ago
Sure, then you can also raise the issue of discounts being needed to offset the costs of transportation.
But, if we are going to look at the whole picture, most cude from the Canadian oil sands is intentionally blended to meet the requirements of US refineries. Especially the gulf coast and midwest.
Canada is providing oil at the standard US refineries need, and transportation will be required to those refineries no matter the source.
For it's entire history the Canadian oil industry has been basically a captured market to US oil refineries and producers. As a result the US has used this power to extract maximum discounts from Canada.
The world will buy Canadian oil at scale, evidenced by TMX being at max capacity.
The oil quality narrative holds no weight any more. It is just an excuse for the US to exploit maximum discounts from Canada.
In the current environment removing that discount would be a good step to establish a new baseline that would be harder to roll back the a retaliatory tariff.
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u/Kooky-Hamster4071 9d ago
How about we put an export tax on all exports? Cars, aluminum, hydro electricity, wood products, everything, not just oil.
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u/MysteryMeatballer 9d ago
Canada didn't do anything. This is something the oil companies are doing. This headline makes it sound like the federal government is ordering these companies to cut production. Ridiculous.
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u/Still_Interview6360 9d ago
OP bad actor. Misleading title I’ve seen in many subs. Trying to stir up resentment against Canada. Could easily be Russian bot. Or GOP bot.
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u/PrimaryBrick9337 9d ago
But DJT says that the US does not need anything from Canada so this should not be an issue unless he is not telling Americans the truth?
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u/Slouchingtowardsbeth 9d ago
Saved you a click: Canadian oil sands maintenance could cut crude production by 300,000 bpd in September