The evidence demonstrating how unleashing Canada’s oil and gas sector will massively benefit the entire Canadian economy is so overwhelming it’s astonishing that any government can continue to ignore it. Two recent studies by the Fraser Institute think tank merely add to the enormous body of information that shows what fools our Canadian politicians are for continuing to hamstring this vital sector of our economy.
The first study concerns the emissions cap that the Trudeau Liberal government introduced in late 2024 and the Carney Liberals may keep. The imposition of this cap would require oil and gas producers to reduce their emissions by 35 per cent by 2030 below the levels registered in 2019. A report by the Parliamentary Budget Officer (PBO) stated this policy will further damage the economy while producing no measurable environmental benefits.
Despite the Trudeau government having severely constrained the oil and gas industry, this sector still contributed about $8 billion in taxes to federal and provincial governments and added $74.3 billion of value to the economy. The sector also provides well-paying employment for over 140,000 Canadian families. Imagine what it could do if its true potential was realized.
Although the Liberal government has consistently denied that their cap on emissions will mean a forced reduction in output of the industry, virtually all objective studies have found that the emissions cap will end up being a production cap. The PBO study found that the policy would mean a reduction in oil and gas output of about five per cent, which would have a substantial negative impact on the entire economy with a loss of over 50,000 jobs. Other studies have estimated even greater job losses and major reductions in GDP and tax revenues to government. All with having a miniscule if any impact on the global climate.
The second Fraser analysis looked at the impact on global emissions if Canada doubled its liquid natural gas (LNG) production and exported it to Asia. The policies followed by the Trudeau government to constrain oil and gas were always justified by the claim they were good for the climate. Yet that seems to be a complete lie.
Coal remains a major source of energy in many Asian countries and even Europe and is a significant source of emissions. LNG has a much lower carbon footprint than coal and, if available, can easily replace it. Substituting LNG for coal in China could lower net global greenhouse gas (GHG) emissions by from 34 per cent to 62 per cent. If Canada doubled current production and exported the additional amount to Asia to replace coal, global GHG emissions could be reduced by as much as 630 million tonnes annually. This is equivalent to 89 per cent of Canada’s total GHG emissions. In other words, Canada could offset virtually all of its emissions by the export of more LNG. By not permitting the Canadian LNG sector to produce and export more, Trudeau’s policies that pretended to be based on helping the climate were actually very environmentally damaging.
Whether the Carney Liberals will choose the glaringly obvious solution to economic growth and real gains for the climate or continue to promote the destructive net zero policies that most other countries and the global business community appear to be abandoning is anyone’s guess. Presumably, we should get some hint when Parliament resumes sitting this week. The fact the new government will not be presenting a budget until the autumn and will be taking the entire summer off are not promising signs. As Carney apparently believes his government can take such a leisurely approach to governing, it seems all that crisis talk during the election was just another Liberal ruse.
If the excessive spending promised in the Liberal election platform comes to pass, a further quarter of a trillion dollars will be added to Canada’s already skyrocketing debt and our credit rating will be at risk of a downgrade. A downgrade means a higher cost of financing our massive debt – which is already well over $50 billion annually – and a further financial burden on Canadians. As the Fraser studies show, the best way to dig ourselves out of that self-imposed hole is to free up our fossil fuel sector, for the good of our economy and standard of living as well as for the good of the climate. We should soon see whether the Carney government values economic success and the well-being of Canadians or will opt to continue the destructive path of Trudeau.
She has published numerous articles in journals, magazines & other media on issues such as free trade, finance, entrepreneurship & women business owners. Ms. Swift is a past President of the Empire Club of Canada, a former Director of the CD Howe Institute, the Canadian Youth Business Foundation, SOS Children’s Villages, past President of the International Small Business Congress and current Director of the Fraser Institute. She was cited in 2003 & 2012 as one of the most powerful women in Canada by the Women’s Executive Network & is a recipient of the Queen’s Silver & Gold Jubilee medals.
