There are three main customers for Alberta’s oil: 1) Alberta refineries; 2) refineries in other parts of Canada; and 3) refineries in the US. While a significant amount of Alberta’s oil output stays within Canada (18 per cent in 2015), Statistics Canada data show that most of our production is exported to the US. Only a small amount (2,426 barrels per day in 2015) makes it to foreign customers other than the US.
One of the most significant changes in the global oil sector has been the steep rise in US production over the last few years. According to the US Energy Information Administration (EIA), the US had been slowly but steadily falling since the mid-1980s but started going up in 2009. In less than a decade, the US added 4.1 million barrels per day to its output by using hydraulic fracturing technology to unlock its shale deposits. US crude production fell to 8.9 million barrels per day in 2016 as low prices curtailed shale drilling but it’s expected to reach 9.5 million barrels per day in 2018.
Fortunately for Alberta, the sudden surge in US output has not displaced imports of crude from our province. As of 2015, EIA data show that the US was importing 1.2 million barrels of crude oil per day more from Alberta than it was in 2009—an increase of 88 per cent. Over the same period, imports from OPEC fell by 1.7 million barrels per day for a drop of 39 per cent.
For more on Alberta’s oil reserves, production and exports, check out the latest edition of Perch, written by ATB's Economics and Research team.