Canadian oil producer Imperial Oil posted a rise in first-quarter profit on Friday, driven primarily by stronger margins in its refining and fuel sales business, sending its U.S.-listed shares up nearly 6% before the bell.
Canadian producers have benefited from the completion of the Trans Mountain pipeline expansion project, which raised its capacity to 890,000 barrels per day. The pipeline offers producers the only export route to international markets bypassing the United States.
“The upstream business continued to benefit from improved egress and narrower heavy oil differentials, while our downstream profitability continued to reflect the structural advantages of the Canadian market,” CEO Brad Corson said.
Imperial’s results come amid a broader rebound in North American refining margins, as product demand remains resilient and supply remains tight due to global disruptions.
Canada sends about 90% of its oil exports to the United States, mostly shipped via pipelines from the western province of Alberta to land-locked refiners in the U.S. Midwest.
The future of this interdependence was thrown into turmoil after U.S. President Donald Trump announced tariffs on the country’s neighbor in the north, a promise he briefly made good in February before rowing back most of the levies within a few days.
Imperial Oil — majority owned by U.S. oil and gas major Exxon Mobil — reported petroleum product sales of 455,000 barrels per day during the first quarter, compared with 450,000 bpd a year ago.
The Calgary, Alberta-based company said synthetic crude oil average realization rose to C$98.79 per barrel, from C$93.51 per barrel a year earlier.
It, however, reported a fall in its upstream production, total throughput volumes and refinery utilization rate.
Imperial’s net income rose to C$1.29 billion ($933.23 million), or C$2.52 per share, during the quarter ended March 31, from C$1.2 billion, or C$2.23 per share, a year earlier.
(Reporting by Pooja Menon in Bengaluru; Editing by Shilpi Majumdar)