KEY POINTS
- Suncor expects to manage potential U.S. tariffs better than competitors.
- The company benefits from the Trans Mountain pipeline expansion.
- Suncor achieved record oil production and plans to grow output in 2025.
Suncor Energy, one of Canada’s largest oil producers, is positioning itself to handle potential U.S. tariffs better than many of its competitors, CEO Rich Kruger said Thursday.
Speaking on a conference call with analysts, Kruger explained that most of Suncor’s oil production, about 60 percent to 65 percent, remains within Canada, either for domestic refining or export through the Trans Mountain pipeline.
This setup, he noted, gives Suncor a “natural hedge” against potential trade restrictions, unlike other Canadian producers who rely more heavily on exports to U.S. refineries.
While uncertainty remains over U.S. President Donald Trump’s tariff policies, Kruger expressed confidence in Suncor’s resilience.
“All Canadian companies will experience the impact differently,” Kruger said. “If we were in a world of tariffs, I like our position relative to our peers.”
U.S. trade policies raise concerns for Canadian oil
The Canadian oil industry is closely watching Trump’s trade decisions after he announced plans to impose a 25 percent tariff on most Canadian products, including a 10 percent tariff on energy exports.
He temporarily suspended the trade tariff implementation for 30 days following commitments from Canada and Mexico, regarding border protection and law enforcement.
Suncor and other Canadian oil companies have benefited from last year’s expansion of the Trans Mountain pipeline, which increased the country’s ability to export oil to Asia and reduced its dependence on U.S. markets.
The added flexibility enables Canadian producers to have more options, in case trade tensions intensify.
“I don’t think anyone on the planet knows exactly what will happen with tariffs,” Kruger said, acknowledging the uncertainty surrounding trade negotiations.
Suncor reports record oil production
In the fourth quarter, Suncor delivered new record oil production which totaled 875,000 barrels per day (bpd) compared to 808,000 bpd from the previous year.
According to Reuters, the company also announced plans to increase production by up to 5 percent in 2025, aiming for improved operational efficiency and cost reductions at its oil sands facilities.
In a research note, TD Cowen analyst Menno Hulshof described Suncor’s production outlook as “conservative,” adding that the company’s strong performance in 2024 could represent a “new normal.”
Suncor’s continued investment in oil sands and infrastructure improvements may help mitigate the impact of potential trade restrictions, ensuring stability amid ongoing global energy market shifts.
