High demand means world needs all of Canada’s oil: IEA – by David Ljunggren (Reuters/National Post – November 27, 2012)

The National Post is Canada’s second largest national paper.

Global demand for crude is growing so strongly that the world needs “every single drop of Canadian oil,” the International Energy Agency’s chief economist said on Monday, playing down fears that growing U.S. production could hit Canadian exports.

Fatih Birol said that even if U.S. output rises as much as the agency expects, the country would still need to import four million barrels a day and that Canada is an obvious supplier.

In its annual forecast this month, the IEA said the United States could come close to energy self-sufficiency by 2035, largely because of the boom in development of unconventional light oil resources.

Canada is the single largest supplier of energy to the United States, sending around 2 million barrels a day to its southern neighbor.

Much of the Canadian crude comes from Alberta’s oil-rich tar sands, where operating costs are higher than in regular fields, and the IEA’s forecast prompted fears that the biggest export market for the oil sands could shrink.  But Birol, asked about potential risks for the oil sands if U.S. output rose, said he did not see any.

“I don’t think so… Oil demand is growing so strongly worldwide that I think the world needs every single drop of Canadian oil,” he told reporters after giving a presentation in Ottawa on the annual IEA forecast.

“The U.S. will still need to import about 4 million barrels per day of oil, and this oil will have to come from somewhere, and I believe Canada will be a primary destination (for supplies) to the United States.”

For the rest of this article, please go to the National Post website: http://business.financialpost.com/2012/11/27/high-demand-means-world-needs-all-of-canadas-oil-iea/

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