International Energy Agency (IEA) Executive Director Fatih Birol recently pointed out that Canada is facing a "once-in-a-generation strategic opportunity" to further elevate itself from an important regional energy producer to a more influential global oil and gas supplier. This assessment is based on the severe energy market disruptions caused by the current conflict in the Middle East.



According to IEA data, the Middle East conflict has caused significant disruptions to global oil supplies, with peak export losses exceeding 1.3 million barrels per day, far surpassing those during the 1970s oil crisis. Birol has called it one of the "greatest energy security threats in history," with shipping in the Strait of Hormuz severely hampered and infrastructure damaged. Even if the conflict eases, a full recovery of production and exports will take considerable time.

Window of Opportunity

Birol warned that missing this window of opportunity would be extremely costly. Even after the crisis ends, the global energy market may experience a prolonged period of "energy security risk premium" and concerns about supply trust. Importing countries are increasingly prioritizing the stability and reliability of their supplies, and Canada, as a rules-based, democratic, stable, and resource-rich country, sees its "credibility" as a significant strategic advantage.

Birol met with former Bank of Canada Governor Mark Carney and Energy Minister Tim Hodgson in Ottawa this week, and emphasized at events in Toronto and Ottawa that Canada needs to accelerate the construction of critical infrastructure. "I hope there will be more reliable suppliers like Canada in the world," he said.

Birol has long advocated for energy security and energy transition in parallel, and this statement continues his stance of supporting increased North American production to fill the gap following the Russia-Ukraine conflict. The current crisis further highlights the priority of energy security, but he also emphasized the necessity of sustainable development.

Canadian Infrastructure Progress

Canada possesses some of the world's richest oil and gas resources, including the Alberta oil sands, the Montreal shale gas, and the British Columbia gas field. Historically, its exports have been heavily reliant on the United States, leading to long-term price discounts for Western Canadian Crude (WCS) due to transportation bottlenecks, heavy crude quality issues, and refinery matching problems. In recent years, the federal government, in collaboration with the provinces of Alberta and British Columbia, has promoted export diversification, targeting Asian (China, South Korea, Japan) and European markets. This shift has made substantial progress since the Trans Mountain (TMX) expansion project came online, with a significant increase in the share of non-US exports (reaching approximately 14-22% by 2025, with some quarterly peaks even higher).

In the LNG export sector: The LNG Canada project is expected to export its first shipment in June 2025 and is currently in the capacity ramp-up phase, with export volumes expected to continue to grow in 2026. The Phase 2 expansion is expected to make a final investment decision (FID) in 2026, which, if implemented, will significantly increase capacity. Projects such as Woodfibre LNG (net-zero emissions facility) and Cedar LNG are also progressing steadily.

If major projects proceed smoothly, Canada's LNG export capacity is expected to reach approximately 18-30 million tons per year by 2030, bringing foreign exchange earnings and employment opportunities to the country. The government's ambitious goals are even higher, but it needs to overcome approval and construction challenges.

Pipeline infrastructure: The Enbridge Sunrise natural gas pipeline expansion project is expected to be approved in April 2026, with construction planned to begin in the summer of 2026 and commissioning by the end of 2028. It will add approximately 300 million cubic feet of capacity per day, supporting provincial demand and facilitating LNG exports. The project is expected to contribute significantly to GDP and tax revenue, and create jobs.

High oil prices have improved profits for Canadian oil and gas producers, potentially leading to increased capital expenditures, but existing pipeline capacity remains under pressure. The industry is calling for further improvements to West Coast export capabilities.

Realistic Outlook

Canadian policy needs to balance energy security, export growth, and the 2050 net-zero target. The practical approach is a parallel strategy of "exports + technology-driven emissions reduction," rather than a simple trade-off. Successfully seizing opportunities can stimulate economic growth, create jobs, increase tax revenue, and diversify exports, reducing dependence on a single market. Strengthening energy trade with the Indo-Pacific region will enhance Canada's global strategic position. The meeting between Birol and Carney has highlighted the priority of accelerating energy infrastructure development.

According to the Canadian Energy Regulatory Authority (CER) outlook, under the current measures scenario, Canadian crude oil production is expected to grow modestly from current levels; the growth potential is greater under a higher oil price scenario. The market share of non-US oil is expected to increase further, but the US will remain the primary export destination.

Overall, Canada possesses resources, stability, and a certain level of infrastructure. If approval processes accelerate in 2026-2027 and west coast projects make new progress, it is expected to solidify its position as a global energy supplier by the early 2030s. However, bottlenecks do exist, requiring pragmatic progress.