CAPP warns that dependence on American energy imports could leave Canada vulnerable to policy shifts and supply disruptions
Canada’s reliance on Unites States energy continues to grow, with several provinces increasingly dependent on American imports for crude oil, natural gas, and refined petroleum, according to the Canadian Association of Petroleum Producers (CAPP).
As Canada’s largest trading partner, the U.S. is central to its energy trade. However, CAPP warns that growing dependence on American energy could threaten Canada’s energy security and economic stability.
According to CAPP, Canada imported an average of 508,000 barrels a day of crude oil in 2024. The U.S. supplied 74 per cent of that, or 375,000 barrels per day. New Brunswick, Quebec, and Ontario account for most of the U.S. crude imports. This makes Eastern Canada particularly vulnerable to fluctuations in American energy policy. New Brunswick imports 165,000 barrels per day (44 per cent), Quebec 124,000 barrels per day (33 per cent), and Ontario 48,000 barrels per day (13 per cent).
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CAPP also highlights Ontario and Quebec’s growing reliance on U.S. natural gas. These provinces now import about half of their natural gas from the U.S. due to high transportation costs for Canadian gas via the TC Energy Mainline. Despite being a major oil producer, Alberta is Canada’s largest importer of refined petroleum products, mostly condensate used to dilute heavy oil for pipeline transport.
Pipeline infrastructure has played a key role in shaping this dependence on U.S. energy. The Enbridge Line 9 pipeline, which connects refineries in Ontario and Quebec, has been reversed several times since its construction in 1976. Initially designed to carry Western Canadian crude, it was reversed in the 1990s to bring foreign crude to refineries in Sarnia. A second reversal in the 2010s allowed both Canadian and U.S. crude to reach Quebec refineries, further cementing Eastern Canada’s reliance on U.S. imports.
The Enbridge Mainline, Canada’s largest crude transport network, moves Western Canadian oil through the United States before reaching Ontario and Quebec. In 2021, Michigan’s governor ordered the shutdown of Enbridge’s Line 5 pipeline, which supplies more than half the crude oil used in Ontario and 66 per cent of Quebec’s supply. The order was challenged in court, but the dispute highlighted concerns about the security of Canada’s energy supply and its reliance on U.S. infrastructure.
CAPP warns that Canada has effectively ceded control over a critical part of its energy supply, particularly as U.S. energy policies continue to evolve. It urges Canada to leverage its domestic resources to strengthen energy security and economic prosperity. CAPP also emphasizes that Canada risks becoming increasingly dependent on foreign sources for vital energy supplies as U.S. energy policies shift, which could compromise its long-term stability.
CAPP also identifies Canada’s natural gas reserves as an underutilized resource, stating that Canada has the potential to become a global leader in liquefied natural gas (LNG) exports. It points to significant untapped natural gas reserves in British Columbia and Alberta. To improve access to domestic and international markets, CAPP recommends regulatory reforms and infrastructure investments, including the expansion of LNG export terminals and new pipelines.
While a reduction in pipeline tolls on the TC Energy Mainline has slowed the shift toward U.S. natural gas imports, American supply remains more cost-effective, according to CAPP’s findings. The shift toward U.S. natural gas has also been driven by Canada’s own energy infrastructure limitations, which have made it difficult to expand domestic production and delivery capabilities. With global energy markets shifting and U.S. policy uncertain, CAPP urges policymakers to prioritize infrastructure projects to strengthen domestic energy security and reduce Canada’s dependence on foreign energy.
CAPP suggests that Canada’s long-term energy strategy needs to move beyond simply meeting domestic needs. A more resilient energy system—one that fully utilizes Canadian resources and avoids over-dependence on the U.S.—could have a stabilizing effect on the economy. Such a strategy, CAPP argues, would not only enhance national security but also position Canada as a key player in the global energy market, increasing its influence on energy policy worldwide.
| Business Desk
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