The situation in the Middle East solidifies Canada’s advantage as a reliable supplier of oil and natural gas
Montreal, March 3, 2026 – The volatility of the price of oil and gas in the wake of the American and Israeli strikes on Iran shows Canada’s advantageous position as a stable and reliable supplier of these resources, according to an MEI researcher.
“From the conflict in Ukraine to the bombings in Iran, recent crises have firmed up our trading partners’ interest in Canadian energy,” explains Gabriel Giguère, senior policy analyst at the MEI. “The reliability and stability of Canada as an energy producer make it a partner of choice for our allies in Europe and Asia.”
The war in the Middle East and the closing of the Strait of Hormuz highlight the vulnerability of the global energy supply in the face of geopolitical tensions. These developments are already having repercussions on global energy markets.
Since Friday, the price of liquefied natural gas in Europe has risen 70 per cent, while the price of a barrel of crude oil has increased by about ten dollars, a sign of the sensitivity of markets to events in this strategic region.
An Economic Note published by the MEI in February showed that Quebec has significant strategic advantages when it comes to liquefied natural gas.
The Marinvest project in Baie-Comeau could help supply Europe, which is still looking for a sustainable way to replace Russian gas. Norway, which supplied a third of European natural gas imports in 2024, projects a drop in production of 28 per cent by 2035.
At the same time, according to the International Energy Agency’s current policies scenario, global demand for natural gas should increase some 30 per cent by 2050. The anticipated drop in supply in Europe, combined with growing global demand, constitutes an opportunity to be seized for new suppliers like Canada.
Quebec also has a major geographic advantage. The maritime route from Baie-Comeau to Dunkirk would take about eight days. From the Gulf of Mexico, it would be around fourteen days, six days more. From Qatar, transport time climbs to over seventeen days. This difference represents a significant logistical advantage for Quebec, and lower transport costs.
On the West Coast, the recent memorandum of understanding signed between Ottawa and Alberta concerning the construction of a new oil pipeline opens the door to greater diversification of energy exports to Asia. Better access to Asian markets would allow Canadian exporters to reduce their dependence on the American market and provide a more stable supply.
“Whether through the development of LNG to Europe or through better access to Asian markets for our oil, Canada has to stop limiting its energy potential,” adds Mr. Giguère. “In a world rife with geopolitical instability, we need to get out of our own way and finally give ourselves the means to export our energy where it’s needed.”
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The MEI is an independent public policy think tank with offices in Montreal, Ottawa, and Calgary. Through its publications, media appearances, and advisory services to policymakers, the MEI stimulates public policy debate and reforms based on sound economics and entrepreneurship.
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