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Reading Time: 4 minutes Global oil markets are stumbling under too much supply and too little demand but Canada’s energy sector is managing to hold its own Oil prices are sliding under the weight of global oversupply and weakening demand, but Canada’s oilpatch is holding steady—perhaps even thriving—as others flounder. Crude is piling up in tankers, major producers are flooding the system, and demand is fading fast. According to a Windward report cited by Oilprice.com, the amount of oil held in floating storage—tankers sitting offshore waiting for buyers—has hit record highs. Sanctions on Russian and Iranian crude have sidelined entire fleets. Meanwhile, Middle East cargoes continue to pour in, keeping global supply bloated. Gunvor CEO Torbjorn Tornqvist called the scale “unprecedented,” warning the market would be flooded overnight if sanctions against Russian and Iran were lifted. And there’s more coming. U.S. crude production has hit a new record of 13.8 million barrels per day in August. And China’s Changqing oilfield just surpassed 20 million tonnes in cumulative output, and national totals have topped 400 million tonnes of oil equivalent this year. More barrels. More pressure. Less price support. At the same time, demand is slipping. U.S. gasoline use is down. Global shipping activity has slowed. JPMorgan just trimmed its 2025 oil demand forecast by 300,000 barrels per day. China’s manufacturing sector shrank for the seventh month in a row. Japan’s purchasing index dropped to an 18-month low. And recession fears are back in the headlines. OPEC+ tried to calm the chaos by announcing a modest increase in output this December, with a pause on future hikes. But the move didn’t move markets. Then Saudi Arabia cut its selling prices to Asia, a clear signal that the kingdom sees weak demand ahead. In short, it’s messy out there. But not everywhere. Amid this global downturn, Canada’s energy sector stands out for one rare quality: resilience. While other producers are scaling back or scrambling to adapt, Canada’s oilpatch is quietly outperforming. A recent CBC News report highlighted the sector’s staying power and why it’s better positioned than its U.S. counterparts. “The companies that have survived here are the companies that have been able to adapt,” said Patrick O’Rourke, managing director at ATB Capital Markets. “It’s effectively Darwinism.” It’s also smart design. Canada’s oilsands—primarily in Alberta—are expensive to build but cheap to run. Once the upfront costs are covered, producers can keep pumping for decades with relatively low reinvestment. That means even in a downturn, output stays strong. Dane Gregoris of Enverus says Canada’s conventional sector is holding up better than the U.S. shale patch. Why? Canadian oil producers operate more efficiently, with fewer legal and logistical barriers tied to land access and ownership than their U.S. shale counterparts. They also benefit from lower operating costs and are less dependent on relentless drilling just to maintain output. And now, they finally have a way to get more oil out. The long-delayed Trans Mountain pipeline expansion is finally complete. It delivers Alberta crude to B.C.’s tidewater and, from there, to Asian markets. That access, once a significant limitation for Canadian producers, is now a strategic advantage. It’s already helping offset lower global prices. Canada’s energy sector also benefits from long-life assets, slow decline rates and political stability. We have a reputation for responsible regulation, but that same system can slow development and limit how quickly we respond to shifting global demand. We can offer a stable, secure supply but only if infrastructure and regulatory hurdles don’t block access to it. And for Canadians, that matters. Oil prices don’t just fuel industry headlines; they shape provincial and national budgets, drive investment and underpin jobs across the country. Most producers around the world are bracing for pain but Canada may be bracing for opportunity to expand its presence in Asian markets, secure long-term export contracts and position itself as a reliable supplier in a turbulent global landscape. None of this means Canada is immune. If demand collapses or sanctions lift, prices could sink further. But in a volatile global landscape, Canada isn’t scrambling—it’s competing. While others slash forecasts, shut wells or hope for an OPEC rescue, Canada’s energy producers are doing something rare in today’s oil market: holding the line. Toronto-based Rashid Husain Syed is a highly regarded analyst specializing in energy and politics, particularly in the Middle East. In addition to his contributions to local and international newspapers, Rashid frequently lends his expertise as a speaker at global conferences. Organizations such as the Department of Energy in Washington and the International Energy Agency in Paris have sought his insights on global energy matters.
