China Hits Record High in Canadian Oil Imports While Reducing U.S. Purchases
China, the world's top crude oil buyer, has a huge impact on global energy markets, shaping supply chains and prices with every move. Lately, there's been a noticeable shift in where China gets its oil. In March 2025, imports from Canada spiked, while purchases from the US dropped. This comes as the US-China trade war heats up, with both countries slapping hefty tariffs on each other. Meanwhile, Canada’s newly expanded Trans Mountain Pipeline has made it easier for China to tap into Alberta’s massive oilsands, driving this change.
Infrastructure Developments: The Trans Mountain Pipeline Expansion
The Trans Mountain Pipeline expansion, or TMX, is a game-changer for Canada’s oil industry. The original pipeline, built back in 1953, has long been a lifeline, carrying oil from Alberta to British Columbia. The expansion, greenlit in 2019 and wrapped up by May 1, 2024, basically doubled the pipeline, boosting its capacity from about 300,000 barrels a day to a whopping 890,000. This massive upgrade has opened doors for Canadian oil producers, letting them ship more crude to eager markets in Asia and beyond, where demand is still going strong.
The Trans Mountain Pipeline expansion is a big deal because it lets Canada ship oil straight out of Vancouver’s port to countries like China, Japan, and South Korea. For years, Canada leaned hard on the US as its main oil buyer, but this pipeline changes that, giving Canada more options. Since the project wrapped up, more and more tankers are loading up at the Westridge Marine Terminal in Burnaby, BC, and heading to refineries in Asia. It’s a lifeline for China, too, offering a steady flow of Canadian crude at a time when trade spats with the US are making things tricky.
Import Trends: Data and Analysis
China’s oil-buying habits are shifting big time, and the numbers tell the story. In March 2025, China snapped up a record 7.3 million barrels of Canadian crude from Vancouver’s port—that’s about 235,000 barrels a day, and it’s only expected to climb. Meanwhile, China’s imports of US oil have tanked. Back in June 2024, they were grabbing 29 million barrels a month, but by early 2025, that’s down to just 3 million barrels—barely 100,000 barrels a day. That’s a jaw-dropping 90% drop, showing just how much China’s leaning on Canada now.
Back before the trade war kicked off, the US was a big player in China’s oil market, shipping over 300,000 barrels a day in 2018 and ranking as China’s second-biggest crude supplier. Fast forward to now, and things have flipped. Canada’s stepped up, sending more than double the oil to China daily compared to the US. It’s not just about the numbers—this shift shows China’s deliberately spreading out its oil sources, hunting for stability as tensions with the US keep simmering.
Trade War Dynamics: Tariffs and Retaliation
The US-China trade war, which started back in 2018 and really ramped up in 2025, is a huge reason China’s changing where it gets its oil. The Trump administration, even in its second go-around, kept piling tariffs on Chinese goods, and China hit back hard. By February 2025, China slapped a 10% tariff on US crude oil, plus 15% on US natural gas and coal, starting February 10. These extra costs make American oil pricier for Chinese buyers, pushing them to look elsewhere—like Canada—for a better deal.
Wenran Jiang, head of the Canada-China Energy & Environment Forum, summed it up nicely in a BNN Bloomberg interview: "given the trade war, it’s unlikely for China to import more US oil. They are not going to bank on Russian alone or Middle Eastern alone. Anything from Canada will be welcome news." China’s playing it smart, spreading out its oil sources to avoid getting cornered, and Canada’s coming out as a big winner. Plus, since the US has slapped tariffs on Canadian goods like steel and aluminum too, Canada and China are finding some common ground, bonding over dodging the worst of US trade barriers and maybe even tightening their economic ties.
Economic Considerations: Price Competitiveness and Refinery Capabilities
Money talks, and it’s a big reason China’s leaning toward Canadian oil. Western Canadian Select (WCS), the go-to heavy crude from Alberta’s oilsands, usually sells at a discount because it’s denser and has more sulfur, which means it needs trickier refining. But here’s the kicker: a lot of Chinese refineries, especially the independent ones in Shandong province, are built to handle this kind of heavy crude. That makes WCS not just workable but a budget-friendly choice for them.
In April 2025, Canadian oil is looking like a bargain for China. Western Canadian Select (WCS), the heavy crude from Alberta, was going for about $55.43 a barrel, figured from the West Texas Intermediate (WTI) price of $64.33 on April 17, minus a $8.90 discount. Compare that to Dubai crude, a Middle Eastern benchmark, which was selling for $71.71 a barrel in March 2025. That big price gap makes WCS a steal for Chinese refiners, especially since shipping it through the Trans Mountain Pipeline and across the ocean still keeps costs in check.
Global Oil Market Context: Demand and Supply Dynamics
The global oil market’s in a bit of a shaky spot right now, with everyone trying to figure out what’s next. The International Energy Agency (IEA) just slashed its 2025 oil demand growth forecast in its April 2025 report, dropping it by 300,000 barrels a day to 730,000 barrels a day. Why? The US-China trade war and other geopolitical headaches are slowing down the economy, and when growth takes a hit, so does the world’s thirst for oil. It’s a reminder of how trade tensions can ripple out and mess with something as big as global oil demand.
Things are getting messy on the oil supply side too. OPEC+ says they’ll bump up production by 411,000 barrels a day starting in May 2025, which could flood the market with more oil. But it’s not that simple—some countries are already pumping more than they’re supposed to. Take Kazakhstan, for example: they hit a record high, churning out 390,000 barrels a day over their OPEC+ limit. That kind of overproduction might cancel out some of the planned increase. With all this going on, the oil market’s teetering on a supply-demand tightrope, and China’s switch to Canadian crude is stirring the pot even more, shaking up global trade patterns.