Canadian crude-by-rail exports rebounding after drastic drop in 2020, regulator says

Canadian crude-by-rail exports fell nearly 40% in 2020, averaging 172,013 barrels per day (b/d) compared with 280,272 b/d in 2019, according to the Canada Energy Regulator (CER).

While the OPEC price war played a role in the initial drop of oil production in 2020, the COVID-19 pandemic caused lower oil demand and a continued production decline in western Canada, leading to excess pipeline capacity and lower volumes being shipped vial rail for much of last year, CER officials said in a press release.

Crude-by-rail exports reached a historic high of 411,991 b/d in February 2020, only to drop to an eight-year low of 38,867 b/d in July 2020. Demand continues to recover gradually, with crude-by-rail volumes increasing 10% between November and December 2020. December volumes reached 190,454 b/d, but still fell short of the 347,136 b/d shipped in December 2019.

Demand uncertainty remains in the near future due to the pandemic, CER officials said.