Crude-by-rail shipments jumped in last half of 2023 as Alberta’s oil output grows
Canadian crude-by-rail shipments nearly doubled in volume in the last six months of 2023, as oil output from Alberta surged to all-time highs and the Trans Mountain pipeline expansion remained under construction.
Data from the Canada Energy Regulator released Monday shows oil-by-rail export volumes jumped from 78,747 barrels per day in May of last year to a high of 167,006 in November.
Though they then declined six per cent to 157,142 in December, that was still 25 per cent higher than the country’s crude-by-rail shipments in December 2022.
For the full year, Canadian crude-by-rail exports averaged 119,077 barrels per day, a seven-year low and down 17 per cent from 2022.
But the sharp uptick in the last half of the year shows the impact of surging oil output in Alberta that has filled Canada’s oil export pipelines close to capacity.
Last year, Alberta’s crude oil production hit an all-time record, totalling just under 1.4 billion barrels last year or about 3.73 million barrels per day.
The increase came as oilsands companies have been ramping up to prepare for the opening of the Trans Mountain pipeline expansion, which will add an additional 590,000 barrels per day of export capacity for this country’s energy industry.
When the Trans Mountain project does come online and begins to fill with oil, the recent increase in crude-by-rail shipments should reverse, said BMO Capital Markets analyst Ben Pham in a recent report.
“For the first time in over a decade, the (Western Canadian Sedimentary Basin) will have excess crude takeaway capacity,” Pham wrote, noting BMO expects Western Canadian crude oil supply to increase from 5 million barrels per day in 2023 to 5.3 million in 2025 and 5.6 million in 2030.
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