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By Dean Brown.
Good day,
A few weeks ago, I looked at a different oil question:
Canada produces a lot of crude. Why don’t we refine more of it here?
Today’s question sounds similar, but it is different.
Canada already produces more finished petroleum products than Canadians consume overall.
So why are parts of Canada still importing gasoline, diesel and crude oil?
The answer comes down to geography, infrastructure and economics.
Canada Produces Far More Oil Than It Can Refine
Canada produced roughly 5.36 million barrels of crude oil per day in 2025.
Canadian refineries have about 1.9 million barrels per day of capacity and processed roughly 1.6 million barrels per day last year.
So even if every refinery ran flat out, Canada would still produce millions of barrels more crude than it could refine here.
And Canada does not have a national shortage of refined fuel.
In 2025, Canadian refineries produced about 117.1 million cubic metres of finished petroleum products, while domestic consumption was roughly 105 million.
Canada already produces more finished fuel than it consumes nationally.
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Canada Actually Exports More Fuel Than It Imports
In 2025, Canada imported about:
9.7 million cubic metres
of finished petroleum products.
We exported:
20.6 million cubic metres.
So the idea that Canada ships crude south and simply buys it all back as gasoline is misleading.
Canada refines a lot of its own fuel and exports a substantial amount too.
The problem is regional.
Canada Is Not One Gasoline Market
Most Canadian crude comes from Alberta and Saskatchewan.
But much of the country’s fuel demand is in Ontario, Quebec, B.C. and Atlantic Canada.
Refineries are also spread unevenly across the country.
That means one region can be short of fuel even while Canada has plenty nationally.
The Canada Energy Regulator says suppliers choose where to buy based on price, availability, fuel specifications, transportation costs and logistics.
The cheapest reliable litre does not always come from another Canadian province.
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Alberta Oil Can Leave Canada and Come Back
This is one of the strangest parts of the system.
Western Canadian crude moves east through Enbridge’s Mainline.
Part of that system crosses from Manitoba into the United States, travels through the U.S. Midwest and then re-enters Canada near Sarnia, Ontario.
From there, crude can continue toward Montreal through Line 9.
So some Canadian crude headed east essentially travels:
Alberta → U.S. Midwest → Ontario → Quebec
That does not mean the United States is taking our oil.
It means Canada’s energy system was built as part of an integrated North American network.
Atlantic Canada Shows Why Imports Can Make Sense
Canada’s biggest refinery is in Saint John, New Brunswick.
It can process roughly 320,000 barrels per day.
But there is no crude pipeline running from Alberta to Saint John.
So much of its crude arrives by ship.
The refinery then supplies Atlantic Canada while also exporting fuel into the northeastern United States.
Canada can therefore export western crude while an eastern Canadian refinery imports crude by tanker.
On a map, that looks strange.
Commercially, it can make sense.
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Canada Can Import and Export Fuel at the Same Time
Refineries do not just produce “fuel.”
They produce different amounts of gasoline, diesel, jet fuel, heating oil and other products.
That means a region can have too much of one product and not enough of another.
In 2024, Central Canada imported roughly 62,000 barrels per day of gasoline while exporting around 50,000 barrels per day of diesel.
That is how imports and exports can happen at the same time.
So Why Not Fix It?
Canada has plenty of oil.
Canada produces enough refined fuel nationally.
But the oil, refineries and customers are not all in the same place.
That leads to a harder set of questions.
Why not build another refinery?
Why not build an all-Canadian west-to-east pipeline?
Would more Canadian infrastructure make us safer?
And would any of it actually lower gas prices?
The Canadian Take Plus
I do the digging. You get the important part.
In the full Plus edition:
Does Canada actually need another refinery?
Would an all-Canadian pipeline make us safer?
And would any of it actually lower what Canadians pay at the pump?
If it cost more, would you support building infrastructure that keeps Canadian oil entirely inside Canada?
One thing before I go…
Canada’s energy system works reasonably well in normal conditions partly because it is flexible.
Oil and fuel can move across provincial borders, through the United States and through international markets.
The weakness is that some of that flexibility depends heavily on U.S. infrastructure.
So I do not think the goal should necessarily be:
never import another barrel.
A better goal is making sure Canada has enough alternatives that no single foreign route can put a major region in trouble.
That is a much more complicated and expensive conversation than the slogan makes it sound.
Until next time,
Dean
P.S. There is another Canada Explained hiding inside this one: Would an all-Canadian west-to-east pipeline actually make economic sense today? I may dig into that separately.