The U.S., being the largest market for Canadian crude, is anticipated to see a rise in fuel demand next year, as a reduction in borrowing rates is expected to stimulate industrial activity, according to the U.S. Energy Information Administration.
However, oil exports to the U.S. may face challenges if the incoming U.S. President Donald Trump implements his proposed 25% tariff on Canadian goods, contingent upon Canada addressing the issues of illegal immigration and drug trafficking at the border.
Suncor, based in Calgary, Alberta, projects its 2025 production to range from 810,000 to 840,000 barrels per day (bpd), marking a 4.4% increase at the midpoint compared to its anticipated output for 2024.
BMO Capital Markets Analyst Randy Ollenberger noted that Suncor is well-positioned to exceed its 2024 production guidance of 770,000-810,000 bpd, raising the possibility of a similar performance in 2025.
Cenovus is also forecasting a 4.4% rise in crude output for 2025, aiming for 805,000 to 845,000 barrels of oil equivalent per day, largely due to the commencement of the Narrows Lake oil sands project.
Imperial Oil, which is predominantly owned by Exxon Mobil Corp, anticipates a 3.1% increase in production.
Canadian oil producers are reaping the benefits of the Trans Mountain pipeline expansion that began operations earlier this year, which has significantly increased the flow of oil from Alberta to Canada’s Pacific Coast, enhancing the price of Canadian crude and providing access to refineries in Asia and the U.S. West Coast.
Suncor has projected a modest increase in refinery throughput volumes, estimating them to reach between 435,000 and 450,000 barrels per day (bpd) in 2025. The company anticipates that its capital expenditures for 2025 will decrease by 3% compared to this year, falling within the range of C$6.1 billion (approximately $4.31 billion) to C$6.3 billion.
Imperial Oil plans to allocate between C$1.9 billion and C$2.1 billion for capital expenditures in 2025, exceeding analysts' expectations. Additionally, the company has raised its 2024 capital expenditure forecast by 9% to C$1.85 billion.
CEO Brad Corson indicated that the increased spending is primarily due to the scheduling of multi-year projects and opportunities, such as enhanced drilling activities at the Cold Lake oil sands project. "We are accelerating certain projects where it is beneficial, allowing us to optimize our capital investments," Corson stated during a call with analysts.
On the Toronto Stock Exchange, Imperial's shares recently fell by 6%, trading at C$97.85. Meanwhile, Suncor's shares decreased by 1.8% to C$53.09, and Cenovus, which plans to maintain its 2025 capital spending in line with 2024 levels, saw a slight dip of 0.7% to C$21.55.