Canadian crude-by-rail exports fall to another eight-year low in July
Shipments were more than 10 times as high in February, when the reached a record
Canadian exports of crude oil by rail fell to another eight-year low in July despite the gradual recovery of North American fuel demand from low levels due to measures taken to control the COVID-19 pandemic.
The Canada Energy Regulator says rail shipments of oil in July fell to about 39,000 barrels per day, down from 42,820 bpd in June (also an eight-year low).
Shipments were more than 10 times as high in February, when they reached a record 412,000 bpd.
July shipments represented an 88 per cent drop from 325,000 bpd in July 2019.
Rail transportation of crude oil is considered to be more expensive than shipping by pipeline so shippers tend to use it only when pipelines are full or if the destination market offers much higher prices than can be achieved in Canada.
Western Canadian producers shut down as much as one million barrels per day of oil production at times earlier this year to avoid selling at low prices, thus freeing up space on export pipelines.