It appears that Canada’s oil industry has been hit significantly hard by the severe implications stemming from the coronavirus pandemic. According to the latest data released by Statistics Canada, domestic production fell by nearly 19% since the beginning of the year, while crude imports dropped by 46%. The alarming data points to the decrease in demand for fossil fuels among Canadians, as the country was under stringent lockdown and travel restrictions since the onset of the pandemic.
In January 2020, crude oil production for the month was sitting at 135,745,080 barrels; however, once many of the government-mandated restrictions were enforced in March, production suddenly dropped to 113,267,907 in April, followed by another nosedive to 110,021,484 in May. The drop in global oil price,s simultaneously with the decline in demand, caused many Canadian companies to slow down oil production, or put it on pause all together.
In the meantime, imports of crude oil into Canada also declined dramatically since the beginning of the year. According to the data, crude imports averaged 28,481,485 barrels in January 2020, and remained relatively steady until the end of March. Come May however, imports fell to 15,363,138, which translates to a decline of over 46%. Canadian crude oil exports also fell dramatically in that time frame with a decrease of more than 13% between January and May, falling from 122,766,499 barrels to 106,691,431 barrels in May.
Information for this briefing was found via Statistics Canada. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.