Wedoany.com Report-Jun 27, S&P Global Commodity Insights has forecasted that Canadian oil sands production will hit a record 3.5 million barrels per day (bpd) in 2025, a 5 percent increase from the previous year. The projection, part of the S&P Global Commodity Insights Oil Sands Dialogue, marks the fourth consecutive upward revision to the annual outlook.

Oil sands production in the country is projected to reach 3.5 million barrels per day (bpd) for the year, 5 percent higher than last year.

By 2030, production could climb to 3.9 million bpd, surpassing 2024 levels by 500,000 bpd and exceeding prior estimates by 100,000 bpd. The outlook anticipates a production plateau later in the decade at higher levels than previously projected, driven by ongoing optimization efforts. These efforts, often resulting from operational experience, enhance efficiency and throughput without requiring significant new investments.

Kevin Birn, chief Canadian oil analyst for S&P Global Commodity Insights, stated: “The increased trajectory for Canadian oil sands production growth amidst a period of oil price volatility reflects producers' continued emphasis on optimization—and the favorable economics that underpin such operations. More than 3.8 million barrels per day of existing installed capacity was brought online from 2001 and 2017. This large resource base provides ample room for producers to find debottlenecking opportunities, decrease downtime and increase throughput.”

Despite lower oil prices, the forecast highlights favorable economics due to producers’ focus on maximizing existing assets through efficiency improvements. Celina Hwang, director of crude oil markets, noted: “Many companies are likely to proceed with optimizations even in more challenging price environments because they often contribute to efficiency gains. This dynamic adds to the resiliency of oil sands production and its ability to grow through periods of price volatility.”

The report notes that existing projects benefit from low breakeven costs, enabling resilience against price fluctuations. However, export capacity constraints pose a potential challenge. Without additional pipeline infrastructure, limitations could emerge as early as 2026, potentially impacting western Canadian oil prices and slowing growth. Hwang added: “While a lower price path in 2025 and the potential for pipeline export constraints are downside risks to this outlook, the oil sands have proven able to withstand extreme price volatility in the past. The low break-even costs for existing projects and producers' ability to manage challenging situations in the past support the resilience of this outlook.”

This forecast underscores the Canadian oil sands industry’s ability to adapt and grow, leveraging existing infrastructure and optimization strategies to meet rising global energy demands.