U.S. President Joe Biden just announced a ban on imported Russian oil into his country. Is it the right thing to do? This latest sanction is to show support for Ukraine and disdain for Russia’s invasion of Ukraine. Will Canada’s Prime Minister Trudeau follow suit?
Global Oil Reserves
Like it or not, crude oil is (currently) the main source of energy around the world. Until that changes (if it ever changes) oil reserves are a huge commodity. Which countries have the most oil reserves? This list from World Population Review shows the current (2022 data) facts…
These facts are deceiving, however. For example, Venezuela’s oil is predominantly offshore so fairly difficult to access. Saudi Arabia’s oil, on the other hand, is located inland and close to the land surface. Crude oil reserves are based not only on quantity but how readily accessible the reserves are with current technology. Regardless, you can see the general position of countries within this list of proven oil reserves. Canada is near the top, the USA is below number ten.
Oil Imports and Exports
So, from this I’m gathering Biden’s sanction banning imported Russian oil won’t have much of an impact on Russia. According to EIA the USA imports most of its oil from Canada:
Canada remained the largest exporter of total petroleum to the United States in December; exporting 4.8 million b/d. The second largest exporter of total petroleum was Mexico with 645,000 b/d.EIA, December 2021
Canada also imports very little oil from Russia, so an imported oil sanction by Trudeau would be more symbolic (like Biden’s) than catastrophic for Putin and Russia. It might poke the bear though.
Canada sits at the top of the list of crude oil importers (predominantly from Saudi Arabia), according to the EIA:
While one of Canada’s biggest exports is, you guessed it, crude oil. This data is from Investopedia:
Are you confused yet? Canada is at the top of the list for its impressive oil reserves, something a cold-weather country should aim to be. We also sit at the top of the exporting of oil list, which economically is great. Isn’t it? But wait, we are also at the top of the imported oil list. How is that economical? Granted, I’m no economist, but I did excel in accounting 101. I am confused, not to mention annoyed and frustrated.
Using Canadian Oil Instead of Imported Oil?
This topic has come up before with Trudeau’s resistance to approving pipelines between the oil reserves in the west for use in the eastern provinces. (Most) Canadians would prefer to use the oil we have, rather than depend on foreign countries for their supply. The Russian invasion of Ukraine just emphasizes this opinion.
The National Post has a great but sad explanation:
So proud is the Trudeau government of its action on environmental stewardship and climate change that it essentially does the Saudis’ dirty work for them. By tightening the screws on domestic Canadian production while seeing an increase in Saudi-originating imports we are helping to accelerate the rate of our own energy-sector’s decline.National Post