2022 was a year of strengthening energy prices in Canada. Producers utilized increased profits to pay down debt and return cash to shareholders. This financial discipline is expected to continue in 2023 as Canadian energy companies navigate global economic uncertainty and inflationary pressures.

Based on data compiled by the research firm Wood Mackenzie, Canadian producers are expected to increase year-over-year spending by 5-6%. The Canadian Association of Petroleum Producers expects investments in natural gas and LNG to continue to grow through 2023, which should push Canada’s 2023 production above the previous record set in 2022.¹ 

Regarding supply chain challenges, there has been some stabilization in pricing for fittings and valves, along with softening on some pipe commodities. Ocean freight rates into Canada are showing a steady decline, although still above pre-COVID-19 levels,.

In July 2022, the Canada Border Services Agency (CBSA) re-initiated an investigation of prices for certain carbon steel and alloy steel line pipe exported from the Republic of Korea to Canada. This resulted in lower Canadian import quantities based on fears that pricing would increase as a result of the inquiry. In December 2022, the CBSA announced the conclusion of this investigation, bringing improved supply and pricing stability to the local market.