Brent spot pulls away as Ottawa backs a Pacific pipeline

Oil. Brent spot (EIA's Europe Brent Spot Price FOB) ended the week at 135.51 US dollars a barrel, up 19.50. WTI at Cushing ended at 97.89, up 12.66 from last Friday's unusually low close. Brent spot's premium over WTI widened to 37.62 from 30.78, the widest of any week this year. ^{1, 2}

Fuel. US diesel averaged $6.40 a gallon on Thursday, after record highs in September. Ukrainian strikes on Russian refineries have forced Moscow to ban diesel exports, CNBC reported, and Chinese refiners cancelled a handful of October gasoline and jet fuel cargoes, according to Reuters. ⁶

Gas and the dollar. Henry Hub gas ended at 2.90 US dollars per million British thermal units, down 0.31. A US dollar bought 1.4246 Canadian at the Bank of Canada's Friday rate, against 1.4145 a week earlier. ^{7, 8}

Ottawa backs a pipeline to the Pacific. On Thursday the federal government listed the West Coast oil pipeline, now called Pacific Link, as a project of national interest under the Building Canada Act, the first project on that list. Canada and Alberta would own it equally, with Indigenous communities offered at least 10%. Ottawa says it would carry an additional one million barrels a day to Asia, and the Major Projects Office aims to settle the project's conditions by September 1, 2027. ^{3, 4}

LNG Canada doubles down. On Monday the partners in LNG Canada (Shell, PETRONAS, PetroChina, Mitsubishi and KOGAS) took a final investment decision on Phase 2 at Kitimat. Two more trains will take the plant to 28 million tonnes a year, from 14 million. ⁵

A third US carrier. US officials told The Wall Street Journal that a third aircraft carrier strike group is heading for the Middle East, with up to 10,000 more troops, all due by the end of November, CNBC reported on Thursday. ⁶

Output flat in July. Real GDP was essentially unchanged in July, 0.0% on the month. Construction grew 1.3%, its fourth rise in a row, while manufacturing fell 0.9%: refinery output dropped 6.2% after unplanned downtime at a refinery in southwestern Ontario. ⁹

Record crude, more of it overseas. Canada produced 27.8 million cubic metres of crude oil and equivalent products in July, the most in any month since the series began in 2016. Crude exports to markets other than the United States, mainly in Asia and Europe, rose 45.0% on the year to 2.8 million cubic metres, 72.9% of it through Vancouver. Exports to the United States slipped 1.3%. ¹⁰

Gas follows. Exports of liquefied natural gas more than tripled from July 2025, when Canada's first LNG terminal began shipping, while pipeline gas exports to the United States fell 8.2%, a seventh monthly decline in a row. ¹⁰

• OPEC+: its meeting on Sunday, October 4, on output for November. ¹¹
• Trade: Statistics Canada's August trade figures, on October 6. ¹²
• Jobs: September's Labour Force Survey, on October 9. ¹³
• Pacific Link: the year of consultations that sets its conditions.
• The Bank of Canada: its next rate decision, with a Monetary Policy Report, on October 28. ¹⁴