HEWERS OF WOOD, DRAWERS OF WATER

Canada’s Role in Global Energy Supply Critical for U.S., Says RBC Chief

By Julianne Geiger - Sep 20, 2024,

RBC CEO Dave McKay believes Canada plays a critical role in the energy security of the United States, especially when it comes to supplying oil and gas to Asia. Speaking in Toronto, McKay highlighted that while the U.S. focuses on "Buy American," they rely on Canadian energy to meet global demands.

The United States needs Canada’s energy resources—particularly oil and LNG—to support Asia, which allows the U.S. to divert its energy supplies to Europe, according to McKay. Canada’s Trans Mountain pipeline expansion and upcoming LNG exports will be keyplayers in this dynamic.

Asia’s demand for cleaner energy, especially natural gas, is growing rapidly. The U.S. Energy Information Administration (EIA) projects a significant rise in Asian oil and gas demand through 2050, with Canada in a prime position to capitalize.

However, McKay warned that federal policies, such as the proposed oil and gas emissions cap, could limit Canada's production, undermining its ability to meet growing demand. He emphasized the need for Canada to continue leveraging its vast energy resources while pursuing a balanced approach to clean tech and emission reductions.

Canada must strike a balance between traditional energy exports and cleaner energy solutions, especially as the world faces increasing energy demands and climate challenges, McKay said.

The exponential growth of artificial intelligence is posing a challenge for energy that is expected to account for 3.5% of global electricity consumption by 2030. In the United States, data centers could reach 9% of electricity generation by the end of the decade—double their current levels. To meet this demand, more renewables and simply more energy production in general will be needed to avoid crippling energy shortages.

By Julianne Geiger for Oilprice.com