OTTAWA, March 25 ― Canada announced yesterday it will boost oil exports by about five per cent to help address supply shortages faced by allies shunning Russian energy after Moscow's invasion of Ukraine.
“Our European friends and allies need Canada and others to step up. They're telling us they need our help in getting off Russian oil and gas in the short term,” Resources Minister Jonathan Wilkinson said in a statement.
Canada is “uniquely positioned to help,” he said, adding that Ottawa “will continue working with our international partners to support international energy markets.”
Wilkinson was taking part yesterday in a ministerial meeting of the International Energy Agency (IEA) in Paris.
“In response to requests for assistance from allies to address supply shortages due to the conflict in Ukraine, Canadian industry has the capacity to incrementally increase its oil and gas exports in 2022 by up to 300,000 barrels per day with the intention of displacing Russian oil and gas,” he said.
Ben Brunnen of the Canadian Association of Petroleum Producers said a short-term increase in production carries risk for the country's industry.
“And at the end of the day, we simply don't have sufficient market egress to really make a substantial difference,” he told AFP.
A government source said even though Canada cannot control the specific destination of oil, once it is on the market it helps boost supply and this will aid European allies.
Canada is the world's fourth largest oil producer.
The IEA last week urged governments to urgently implement measures to cut global oil consumption following supply fears stemming from Russia's invasion.
The outbreak of war in Ukraine has sent fuel prices up sharply and led to major economies, such as the United States and Canada, sanctioning Russia by banning imports of its oil.
Oil prices fell earlier yesterday, with Brent North Sea crude, the main international benchmark, dipping under US$120 (RM507) per barrel to trade at around US$116.
Prices had gone up in recent days in part because traders believed the European Union could soon impose sanctions on Russian oil. ― AFP