Canada is pushing more of its heavy crude into the U.S. Gulf Coast, with a new Enbridge terminal giving oil-sands barrels fresh access to America's biggest refining hub. The push comes even as Ottawa and Washington escalate a tariff fight, though energy remains explicitly exempted from the latest trade measures.
More than 90% of Canada's crude exports flow to the United States, and that trade has only deepened. U.S. imports of Canadian crude averaged just over 4 million bpd during the first half of 2026, while total Canadian crude exports in June ran 6.4% higher than a year earlier.
A new outlet on the Gulf Coast
Canadian heavy crude has become harder for Gulf Coast refiners to replace, as Mexican output declines and Venezuelan supply is rising but still somewhat uncertain. Enbridge's Houston Oil Terminal, which began operations in July, now gives Canadian oil-sands production access to the Gulf Coast's heavy, sour crude processing plants.
According to the Canadian Global Affairs Institute's Joe Calnan, that refinery cluster boasts "the greatest concentration of heavy, sour crude processing capacity anywhere in the world", built to run grades from Venezuela and Mexico that resemble Canadian barrels.
The Midwest still takes the bulk of Canadian crude oil, absorbing roughly 2.92 million bpd in the first half of 2026. The Gulf Coast is a far smaller outlet by comparison: Canadian crude processed in PADD 3 averaged 416,000 bpd in 2025 and fell to roughly 337,000 bpd in the first half of 2026, down from 526,000 bpd in 2024. Enbridge plans to expand the new terminal's storage from 2.5 million barrels to 15 million barrels to push more volume into that market.
Pacific capacity is expanding too
Canada is widening its Asia-facing route at the same time. The Trans Mountain expansion nearly tripled pipeline capacity to 890,000 bpd when it entered service in Q2, and the system hit full capacity for the first time in June. Trans Mountain now plans to add another 90,000 bpd in Q4 and 210,000 bpd by the end of 2028, with most of that extra barrel count expected to head to Asia.
Tariffs leave energy untouched
Canadian retaliatory tariffs of 15%, 25% and 50% on C$27.6 billion of U.S. goods took effect Tuesday, matching U.S. Section 338 tariffs dollar for dollar on products including steel, dairy, appliances, agricultural equipment, pulp and paper and electronics. The White House explicitly excluded energy, potash and critical minerals from those Section 338 tariffs, leaving the cross-border crude trade untouched by the dispute.
Source: Oilprice.com
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