War in Ukraine sparks discussion about North American energy security

As Russia's invasion of Ukraine rages onwards, the country is becoming increasingly isolated from global markets, and its energy exports cut off. And that's sparked a discussion about whether Canada could fill part of the gap. 

Russia has been excluded from Swift ⁠— a bank messaging system that underpins global trade ⁠— and several shipping companies have said they will stop operating in the region.

Now, some countries are considering cutting off imports of Russian gas and coal, an effort that hinges on diversifying their imports. 

Russia exports about five million barrels per day of crude, amounting to about 12 per cent of the global oil trade. Some 60 per cent of this goes to Europe and another 20 per cent to China.

Last week Germany suspended a major Russian natural gas pipeline, a move that Sabine Sparwasser, Germany's ambassador to Canada, said is leading European countries to look elsewhere for energy. 

"We will be looking towards LNG possibilities ⁠— and Canada is a very significant player," Sparwasser said.

Alberta Premier Jason Kenney took to Twitter this week to suggest the world should look to Canadian energy amid the conflict instigated by the world's third largest oil producer.

"Alberta is a rights-respecting liberal democracy with the third largest energy reserves in the world," he tweeted.

"We can be a major force for global stability by displacing conflict oil from Russia and other dictatorships."

But the question of whether or not Canada is in a position to meet more of the world's energy needs is another story. 

The province will face a familiar challenge — getting its products to the coast, according to energy market economist Rory Johnston.

"Unfortunately it's unlikely that there's anything we can do to alleviate this crisis," he said.

"But what we can do is be in a better position to be better prepared for the next inevitable crisis." 

Johnston says that as stable and ethical sources of energy continue to be demanded in Europe and elsewhere, an increased pace of growth in Canada's oil and gas sector could help it carve out a larger share in the market and compete with other producers like Russia and OPEC.

"We could definitely grow to produce and provide more crude oil in the free world to support our allies within NATO in the future."

This kind of forward-looking thinking is something that Richard Masson with the University of Calgary's School of Public Policy says Canada needs to employ to not only fill future market gaps but to increase resilience to global shocks when they happen again. 

"We've seen this with the OPEC embargoes and in other instances — we get complacent and we don't think through what could go wrong and we get supply crunches," said Masson. 

Masson says the conversation has to go back to finding ways to export Canadian oil and gas efficiently. 

"We're a very secure supplier if we can get the pipelines built to get our product to the market," he said.

He believes the war in Ukraine could make infrastructure projects that would streamline energy transport a potentially easier sell. 

"The world has changed, I think, in the last couple of months, especially in the last few days, and now security supply is going to be a bigger part of the equation going forward."