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Export Constraints Loom as Pipeline Space Fails to Keep Pace with Production
Canadian oil sands production is projected to hit record levels in 2025 despite a lower oil price environment, according to a new forecast from S&P Global Commodity Insights. Output is expected to reach 3.5 million barrels per day, a five percent increase over 2023 levels. This marks the fourth straight upward revision in the annual outlook, driven largely by producers optimizing existing operations and improving efficiency.
The report anticipates continued growth through the end of the decade, with production potentially reaching 3.9 million barrels per day by 2030. S&P says producers are relying on low-cost improvements and operational enhancements rather than launching new projects. The forecast reflects confidence in the sector’s ability to grow even amid volatile market conditions, supported by historically low breakeven costs.
However, the outlook also warns that pipeline capacity could begin to run out as early as next year. Without new infrastructure, export constraints may emerge, putting pressure on regional oil prices and capping future growth. The forecast identifies these potential bottlenecks as a major risk to an otherwise resilient and efficient sector.
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