Canadian Oil and Gas Production in the Global Clean Energy Transition

This report by the International Institute for Sustainable Development analyzes the economic risks of continued investment in Canadian oil and gas production under various International Energy Agency demand scenarios, suggesting that restricting expansion is the most effective way to mitigate financial risks and leverage economic potential for clean industries.

• Under a 1.5°C climate scenario, up to 66% of future capital investments in Canadian oil and gas projects between 2025 and 2040 are at risk of becoming stranded, a figure that could increase if carbon capture and storage technologies underperform.
• The risk of stranded investments varies by policy scenario: 5% of projected investments may fail to deliver returns under current global policies, while this figure rises to 39% under announced climate policies and net-zero pledges.
• Canada's oil and gas industry is highly vulnerable to international market shifts because 81% of its oil and 44% of its gas are exported, making profitability susceptible to climate-related trade risks, rising competition, and weakening demand.
• The report proposes a paradigm shift where Canada limits the expansion of its oil and gas industry to mitigate economic risks for governments, industry, and investors, instead using remaining revenues to grow clean industries.

APA

Muttitt,, G. (2025). Canadian Oil and Gas Production in the Global Clean Energy Transition. International Institute for Sustainable Development. https://www.iisd.org/publications/report/canada-oil-gas-clean-energy-transition

Chicago

Muttitt,, Greg. Canadian Oil and Gas Production in the Global Clean Energy Transition. International Institute for Sustainable Development, 2025. https://www.iisd.org/publications/report/canada-oil-gas-clean-energy-transition.

Wikipedia

{{cite report |last1=Muttitt, |first1=Greg |title=Canadian Oil and Gas Production in the Global Clean Energy Transition |publisher=International Institute for Sustainable Development |date=25 June 2025 |url=https://www.iisd.org/publications/report/canada-oil-gas-clean-energy-transition |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{muttitt2025canadian, author = {Muttitt,, Greg}, title = {{Canadian Oil and Gas Production in the Global Clean Energy Transition}}, institution = {International Institute for Sustainable Development}, year = {2025}, month = jun, url = {https://www.iisd.org/publications/report/canada-oil-gas-clean-energy-transition}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }