Why Are We Importing Oil from the U.S.?
July 4, 2025
You might have seen headlines recently about Ontario Premier Doug Ford and Prime Minister Mark Carney pushing to reduce oil imports from the United States. At first glance, the initiative makes sense and has garnered some cheers within the Buy Canadian community. After all: if the U.S. is going to hit us with tariffs, why should we keep buying their oil?
But looming behind this story is an important question: why are we importing oil from the United States at all? Canada is the fourth-largest oil producer in the world—we pump out over 4.5 million barrels per day, and export nearly 98% of those barrels to the U.S. So, what possible reason could there be for also importing U.S. oil into Canada?
The TL;DR is a bit crazy: we simply don’t have the infrastructure to use and supply Canadians with the oil that we produce.
Want more detail? We lay it out as clearly as possible below.
The Geography Problem
The core issue isn’t that we import oil. It’s that we have to.
Most Canadians know that most of the oil we produce is in Alberta and Saskatchewan. But, of course, the oil we consume is spread out across the country, and the biggest demand generally comes from the population centers in Ontario and Quebec, and from some of the oil refineries in the Atlantic provinces. That’s a very large distance to cover—larger than many whole countries, and comparable to Toronto-to-Miami. Covering that distance is one of Canada’s major challenges, not just with regard to oil, but with regard to all of its domestic infrastructure needs.
The solution for getting western oil to eastern consumers is a strong, integrated pipeline infrastructure across the country. But…we don’t have that. Over the past number of decades we’ve dedicated money to building a reliable pipeline that runs south, into the U.S.; but for a variety of reasons—political opposition, environmental concerns, Indigenous protections, regulatory gridlock—we’ve still not been able to find a way to get a continuous pipeline from east to west across the country.
As such, it’s actually much easier for us to export oil to the U.S., have that oil piped across their country instead, and then reimported back into Canada. It’s almost too bizarre an economic/energy plan to be true; and yet it is.
The Infrastructure Problem
Even if we had a direct west-to-east pipeline, we’d still run into another barrier: refinery compatibility. The oil sands produce mostly heavy crude, which (believe it or not) eastern Canadian refineries weren’t built to handle. Many of these facilities—especially older ones in places like Montreal and Saint John—were designed decades ago for lighter, sweeter crude, historically imported from places like the Gulf of Mexico, the North Sea, or West Africa.
Retooling those refineries to process Alberta’s heavier product would require massive capital investment, with no guarantee of a stable policy environment or long-term supply agreements. It’s not impossible—but in the absence of clear national coordination, few players are willing to take that kind of risk.
As a result, even within our own borders, it’s often cheaper to import oil than to reconfigure systems to use our own. And so, again, what we do is ship our oil down south, let them refine it, and then let them sell it back to us at a premium. Again, hard to believe, yet true.
The Consequences
Relying on the U.S. to supply large parts of our domestic energy needs creates a structural vulnerability. It leaves Canada exposed to foreign policy shifts, protectionist trade policies, and tariff retaliation—something we’re seeing play out right now. It also means that we’re exporting raw resources and importing refined ones, losing out on the higher-value stages of the supply chain.
In broader terms, Canada increasingly resembles a resource supplier in someone else’s economic engine, rather than a self-sustaining system of our own. And the longer we lean into that role, the harder it becomes to shift course.
So when Ford and Carney float the idea of reducing U.S. oil imports, they’re not just reacting to tariffs—they’re tapping into a much deeper issue. One that should have been addressed decades ago.
What It Would Actually Take
While Carney continues to platform on the need to move faster than we ever have before, the reality is that reducing reliance on U.S. oil isn’t a switch we’ll just be able to flip. It’s still a multi-decade project that will require real, coordinated action at the highest level, and real, coordinated cooperation between federal, provincial, environmental, and Indigenous agencies. It will require aligning Alberta’s production priorities with Ontario’s consumption realities. It will require modernizing our refineries in the east to process western crude, rather than continuing to buy light oil offshore because it “fits better.” And it will require that leaders stop putting up self-serving roadblocks, and instead align on finding a way to lay pipe in the most thoughtful way possible.
This will require significant investment at many levels. But without that investment, we will remain trapped in a value chain that leaves wealth—and security—on the table.
Where The CANADA List Stands
We believe this country should be more than a pit stop for commodities. It should be a place where resources are refined, transformed, and circulated internally—where value is created here, not exported. Jobs. Infrastructure. National resilience. These are not luxuries; they’re the foundation of any serious economy.
This isn’t a call for economic nationalism, nor is it a rejection of trade. It’s a call for strategic autonomy—for a more intelligent kind of interdependence. Because what we’ve built today isn’t partnership. It’s dependency. And that dependency has a cost.
The U.S. is not our adversary. But they are, increasingly, our competitor. And in a world of tariffs, trade weaponization, and shifting allegiances, pretending otherwise is not principled—it’s naïve. If we want to thrive in that world, we need to stop exporting leverage and start building capacity. Starting with energy.
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