This quarterly economic forecast presents the medium-term outlook for the Canadian economy. This release focuses on energy. For an overview of all major components of the economy, go to the Canadian Outlook main page.
An Optimistic Outlook for Oil and Gas: Canada’s Two-Year Energy Outlook
An Optimistic Outlook for Oil and Gas: Canada’s Two-Year Energy Outlook
Canadian Economic Analysis
Industry Economic Analysis
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- Crude oil prices are forecast to rise further as oil demand rapidly recovers, although supply is slower to catch up. But an increase in supply from OPEC+ and U.S. shale producers could potentially limit price increases later this year.
- Capital expenditures are expected to increase moderately in 2021. Rig counts remain at a fraction of pre-pandemic levels as oil firms narrow in on reducing their debt levels.
- Canadian oil output and exports are expected to grow substantially in the second half of the year alongside the pickup in the U.S. economy.
- Pipeline bottlenecks have long been a problem for the industry. But the Enbridge Line 3 and Trans Mountain Pipeline expansion projects will add significant takeaway capacity over the next few years.
- Canada’s oil and gas industry will continue to face growing pressure to drastically cut emissions from their operations. This will require heavy investments in carbon abatement technologies.
- Canada has several wind and solar projects currently under construction. Renewable energy projects will continue to grow as Canada aims to meet its net-zero emissions target by 2050.
- Natural gas exports are forecast to grow modestly over the next several years as natural gas remains a relatively cheap energy source and major investments in export capacity are under way.
- As the virus is receding in parts of the world, it continues to spread in others. The spread of new coronavirus variants globally and the possibility of new lockdowns continue to be a significant risk to our outlook.
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