It’s not news that the United States is the largest export market for Canadian goods and services: In 2021, Canada exported a record $477 billion worth of stuff to the U.S., led by crude oil, vehicles and machinery, in that order.
Burrow your way a bit deeper into those numbers and you’ll see that leading the way in trade at the subnational level — by a few metric tonnes — is trade between Alberta and Illinois which, at $39.6 billion, is 8.3 per cent of the nation-to-nation total. Why? Two words: crude oil.
There are five pipelines (all owned by Enbridge) stretching 1,800 kilometres from Edmonton to Superior, Wisconsin, from which much of the oil then enters other pipelines heading 700 kilometres south to Chicago. A cluster of refineries in and around the windy city have been retooled to handle the heavy crude produced from the oil sands.
“It reinforces that whatever the future holds, crude oil is still our number one export and the U.S. is virtually our only purchaser,” says Rob Roach, Deputy Chief Economist with ATB Financial. “A little makes it to Mexico and other countries but 99-plus per cent goes to the U.S.”
The only subnational trade category that approaches the oil and gas business Alberta does with Illinois is the motor vehicle trade between Ontario and Michigan, which clocks in around $13 billion.
“It highlights just how dominant oil and gas is,” says Roach. “Alberta does sell a lot of other stuff to the U.S. – agriculture is number two, but it’s such a distant number two. It’s not even close.”
This article appears in the September 2022 issue of Edify