Friday , May 14 2021

Canada's oil imports from Saudi Arabia have risen since 2014, according to trade data

Canada's oil imports from Saudi Arabia have been increasing steadily over the last five years, according to Canadian statistics trade statistics, which were examined by CBC News, and disturbing diplomacy with the kingdom does not significantly affect Canada's appetite for Riyadh oil.

Total Canadian imports from Saudi Arabia have increased by 66% since 2014, with imports increasing each year during the same period.

Last year, Canadian companies invested $ 3.54 billion in imports of 6.4 million cubic meters of Saudi oil, compared to 5.9 million cubic meters worth $ 2.5 billion in 2017, before the controversy began in August 2018.

In January 2019, for example, the import of oil from the Kingdom was 607 million cubic meters, compared to 559 million cubic meters the previous year. And although the monthly imports gyrate significantly – a normal trend in the oil business, according to analysts – the long-term trend is to err.

"Over five years, imports from Saudi Arabia have grown," said David Hughes, a former research director with the Geological Survey of Canada and president of Global Sustainability Research, Consulting In Calgary. In January 2019, Saudi oil accounted for 10% of Canadian consumption, compared to 8% in 2017.

Saudi Arabia is the second largest source of foreign oil for Canada, after the United States.

"Not a diplomatic question"

Observers are divided over what imports rising from Saudi Arabia should mean Canadian policy.

Human rights groups claim that Canada should not support the Saudi regime by buying oil, following the recent executions of 37 people, the killing of journalist Jamal al-Hilal, a bloody war in neighboring Yemen, and a host of other abuses.

When the diplomatic conflict between Canada and Saudi Arabia began last August, Saudi Energy Minister Al-Falah said oil exports from the kingdom would not be affected. (Ronald Zack / AP)

Sources in the energy industry say an increase in imports reinforces the case of building pipelines from Alberta to eastern Canada, where most of the Saudi imports are now sold.

Environmental organizations say more pipelines will not actually cut dependence on Saudi Arabia, as Canadian oil can not be easily processed in refineries in the East, and investment in green energy is the best way to reduce dependence on oil-rich autocratic states.

Other analysts say that imports have nothing to do with politics, and are based on privately owned Canadian refineries who want the right to the oil at the cheapest price.

"Oil is the commodity traded freely in the world," said Jim Crane, an energy expert at the Baker Institute for Public Research at Rice University in Texas. "For the Canadian refinery, this is an economic or chemical question, not a diplomatic question … They do not buy it based on the relationship between Ottawa and Riyadh or human rights violations in Saudi Arabia."

Status of rights deterioration

The Embassy of Saudi Arabia in Ottawa did not respond to requests for comment.

While the war of words between Canada and Saudi Arabia has died since last summer, the conflict continues. Canada did not apologize for calling for the immediate release of detained women's rights activists, as demanded by Saudi Arabia.

Ottawa has not been an ambassador in the kingdom since Dennis Horak was expelled last year and the Saudis have not rescinded their commitment to stop buying Canadian berries or returning flights to Toronto.

"The documentation of human rights in Saudi Arabia … has deteriorated significantly in recent years significantly," said Alex Naveh, secretary-general of Amnesty International.

"The Canadian government should ensure that business relations do not cause or contribute to human rights abuses in any country, including Saudi Arabia."

Oil accounts for about 70 percent of Saudi Arabia's export earnings and half of its gross domestic product, according to the Organization of Petroleum Exporting Countries (OPEC), which means oil exports are the lifeblood of the Kingdom's economy and its absolute monarchy.

"Additional pipe capacity"

A spokesperson for the Canadian Petroleum Producers Association (CAPP) said that increased imports from Saudi Arabia are boosting the call for additional pipelines to increase market access to Canadian crude oil.

"At the moment, our pipeline network is quite extensive, but it does not expand to the East Coast," said Mark Finney, CAPP's market and transport director. "There are some refineries and Canadian manufacturers are not able to easily reach …. Another pipeline capacity is the answer to many things."

In 1980, Canadian Prime Minister Pierre Trudeau met with the Saudi oil minister, Sheikh Yamani, in the desert camp of Medin Saleh in Saudi Arabia. (Andy Clark / Canadian Press)

While oil imports from Saudi Arabia and the United States have increased, Canadian imports have been declining since 2016, he said.

Imports declined in general due to the reversal of the Anbridge tube line 9, allowing more Alberta golanders to easily switch to refineries in Ontario and Quebec, Pini said.

He said the industry was "frustrated" at the slow progress in building new pipelines that would allow local manufacturers to compete in the supply of Canadian markets in the east, which could lead to the displacement of future imports.

Between 2015 and the end of 2018, he said, total Canadian imports fell by 13%.

Canada is the fourth largest producer and fourth largest oil producer in the world, according to the National Research Council and 99% of Canadian oil exports to the US It is not uncommon for countries to be exporters and importers of crude oil, analysts said.

Energy transfer

Most Saudi oil exports to Canada go to the refinery in Eastern Canada, particularly the Irving St George refinery, and facilities in Quebec, said David Hughes, the consultant.

The refinery is specifically designed to treat light oil from the Middle East, rather than heavy crude oil from the oil, Hughes said. His re-determination to process Alberta oil will cost around $ 1 billion, he estimates.

Irving did not respond to requests for an interview.

Most of the Saudi oil imported to Canada goes to the Irving refinery in St. John's. (Andrew Waughan / Canadian Press)

It is not clear whether the company would like to spend this money, even if Canada's Canadians network has been expanded to the Atlantic provinces, as it has now been neglected in the $ 15 billion East Energy pipeline.

Irving Oil in St. John [where the formerly proposed Energy East pipeline would go] It was clear that they would not sign binding contracts to take oil and oilands, "said Tim Gray, CEO of the Toronto-based environmental protection campaign group.

Most of the Alberten's production that was offered for the pipeline was exported, he added, calling on Canadian companies to accelerate the switch to renewable energy.

"Oil imports can offset by successful efforts to electrify our economy," Gray said. "This means that electric cars, home heat pumps and industrial processes using clean electricity can cause a rapid reduction of the need for foreign oil."

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