Canadian pipelines to nowhere
Lack of midstream takeaway capacity had been a growing concern for years, but Covid-19 has reversed the danger
Western Canadian oil producers have suffered from a shortage of export capacity from the region for much of the past decade, in part due to the environmental movement and its allies— strongly opposed to Alberta’s oil sands industry—slowing the pace of pipeline development. The Covid-19 pandemic has turned this problem on its head. Regional production of c.1.2mn bl/d has been shut in due to lower prices following a collapse in demand for refined products, particularly gasoline and jet fuel—leading to a significant surplus of takeaway capacity from the region. The short-term surplus should dissipate over the next year or so as North American and global oil demand rebounds. But it is likely t
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