In this week’s EconMinute, we’re talking about the Canada Energy Regulator’s recent Canadian oil production scenario forecasts.
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Last December, the Canada Energy Regulator released its Canada’s Energy Future 2021 report, an annual exploration of possible long-term scenarios for energy produced and consumed in Canada. This includes forecasting oil production levels out to 2050 under two guiding sets of assumptions about the future—the Evolving Policies Scenario (EPS), and the Current Policies Scenario (CPS).
The EPS broadly assumes that Canadian and global climate action accelerates at a pace consistent with recent history, whereas the CPS assumes that climate action remains at the level of policies in place today. These scenarios also include assumptions about crude oil prices and low-carbon technology development and uptake, largely in response to future policy stringency assumptions.
The scenario analyses indicate that Canadian oil production could remain resilient—and even higher than current levels—under both scenarios until at least 2046.
- After production declines in 2020 due to the pandemic, the EPS projects that it will grow until at least 2032 (17% above anticipated 2021 production levels).
- Under the CPS, projected oil production does not hit its peak until 2044 (34% above anticipated 2021 production).
- After the CPS’s anticipated 2044 production peak, output levels remain relatively flat until the end of the forecast period, about 32% above 2021 levels.
- The EPS forecasts a gradual decline in production beginning in 2032; nonetheless, output is expected to fall to just 4% below 2021 levels by 2050.
Note: Neither scenario aligns with Canada’s net-zero 2050 emissions target.