The U.S. president’s call for a peace deal in Ukraine rattles global markets
Oil markets are tumbling into bear territory, driven by a potent mix of geopolitical upheaval, weakening demand and surging supply. The latest shock came after U.S. President Donald Trump reversed his stance on the Russia–Ukraine war, easing pressure on Moscow and casting uncertainty across global energy markets.
Following a meeting with Russian President Vladimir Putin in Alaska on Aug. 15, Trump abandoned his earlier demand for a ceasefire and is now calling for a full peace deal. This puts intense pressure on Ukrainian President Volodymyr Zelenskiy to concede land—something long demanded by Russia and now backed by the United States. Trump also dropped threats of further sanctions and signalled that countries such as China will not be penalized for importing Russian oil.
Oil prices slipped in early Asian trading on Aug. 18, as markets reacted to Trump’s diplomatic shift and easing concerns about supply disruptions. With Russian crude set to keep flowing freely and no new U.S. penalties on the table, the policy change signalled a loosening of pressure on Moscow. European leaders—including European Commission President Ursula von der Leyen, French President Emmanuel Macron and NATO Secretary General Mark Rutte—have expressed support for Ukraine, but market focus remains on Washington, not Brussels.
Crude futures are down more than 10 per cent this year and are trading in a narrow range. Trump’s escalating trade tensions, especially with China and India, rising output from OPEC+ members and global consumption trends are weighing heavily on prices.
Beyond Russia and Ukraine, broader trade tensions are also weighing on oil markets. India’s position adds further uncertainty. While Trump appears content to let China import Russian oil, India faces a more complex relationship. Trade talks with the U.S. have stalled, and a planned delegation visit has been deferred. At the same time, Indian Prime Minister Narendra Modi is seeking to stabilize ties with both Russia and China. Trump has not ruled
out imposing a 25 per cent tariff on Indian exports starting Aug. 27, putting strain on a key buyer of Russian crude and a growing energy power in its own right.
At the same time, long-term demand signals are flashing warning lights. The International Energy Agency (IEA)—an energy watchdog for industrialized nations—is warning of a significant supply glut within months as both OPEC+ (the oil-producing alliance that includes Russia) and non-OPEC production continue to climb while demand lags.
The IEA’s August report cut global oil demand growth to 680,000 barrels per day in 2025 —20,000 barrels below July’s estimate. Its 2026 projection is only slightly higher at 700,000 barrels per day. Since January, the agency has slashed its 2025 growth forecast by 350,000 barrels.
OPEC remains more optimistic. It left its 2025 growth forecast unchanged at 1.29 million barrels per day and expects fourth-quarter demand this year to reach 106.36 million barrels per day. For 2026, it nudged its estimate up to 106.52 million barrels. Despite that confidence, government forecasts point to continued weakness.
The U.S. Energy Information Administration predicts Brent crude will fall to US$58 per barrel by the fourth quarter of 2025, down from US$71 in July. It could drop further—to US$50, by early 2026.
For Canada, this is no sideshow. A prolonged price slump would hit Alberta’s resource dependent economy hard, cutting into royalties, tax revenues and employment. That impact extends across the country, affecting GDP, transfer payments and public services supported by energy wealth.
Trump may view a hasty peace deal and hands-off oil policy as strategic wins, but for energy markets—and countries like Canada that rely on resource exports—the fallout could be lasting and painful.
Toronto-based Rashid Husain Syed is a highly regarded analyst specializing in energy and politics, particularly in the Middle East. In addition to his contributions to local and international newspapers, Rashid frequently lends his expertise as a speaker at global conferences. Organizations such as the Department of Energy in Washington and the International Energy Agency in Paris have sought his insights on global energy matters.
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Compared to last December, Canadians are paying far more attention.
Canada’s energy conversation has changed in a year, not by becoming gentler, but by becoming real. In late 2024, pipelines were still treated as symbols, and most people tuned out. By December 2025, Canadians are arguing about tolls, tariffs, tanker law, carbon pricing, and Indigenous equity in the same breath, because those details now ultimately decide what gets built and what stays in the binder. Prime Minister Mark Carney has gone from a green bureaucrat to an ostensible backer of another pipeline from Alberta to the West Coast.
From hypothetical to live instrument
The pivot began when the Trans Mountain expansion started operating in May 2024, tripling capacity from Alberta to the B.C. coast. The project’s C$34 billion price tag, and the question of who absorbs the overrun, forced a more adult debate than the old slogans ever allowed. With more barrels moving and new Asian cargoes becoming routine, the line stopped being hypothetical and became a live economic instrument, complete with uncomfortable arithmetic about costs, revenues, and taxpayer exposure.
The American election cycle then poured gasoline on the discussion. Talk in Washington about resurrecting Keystone XL, alongside President-elect Donald Trump’s threats of 25 percent tariffs, reminded Canadians how quickly market access can be turned into leverage.
In that context, Trans Mountain is being discussed not just as infrastructure, but as an emergency outlet if U.S. refiners start pricing in new levies.
The world keeps building
Against that backdrop, the world kept building. Global pipeline planning has not paused for Canadian anxieties, with more than 233,000 kilometres of large diameter oil and gas lines announced or advancing for 2024 to 2030. The claim that blocking Canadian projects keeps fossil fuels in the ground sounds thinner when other jurisdictions are plainly racing ahead.
The biggest shift, though, is domestic. Ottawa and Alberta signed a memorandum of understanding in late November 2025 that sketches conditions for a potential new oil pipeline to the West Coast, alongside a strengthened industrial carbon price and a Pathways Alliance carbon capture requirement. One Financial Post column argued the northwest coast fight may be a diversion, because cheaper capacity additions are on the table. Another argued the MOU is effectively a set of investment killers, because tanker ban changes, Indigenous co ownership, B.C. engagement, and CCUS preconditions create multiple points of failure.
This is where Margareta Dovgal deserves credit. Writing about the Commons vote where Conservatives tabled a motion echoing the Liberals’ own MOU language, she captured the new mood. Canadians are no longer impressed by politicians who talk like builders and vote like blockers. Symbolic yeses and procedural noes are now obvious, and voters are keeping score.
Skills for a new era
The same sharper attention is landing on carbon capture, once a technocratic sidebar. Under the MOU, a new bitumen corridor is tied to Pathways Alliance scale carbon management, and that linkage is already shaping labour planning. A Calgary based training initiative backed by federal funding aims to prepare more than 1,000 workers for carbon capture and storage roles, a sign that contested policy is producing concrete demand for skills.
British Columbia is no longer watching from the bleachers. It flared again at Carney’s December 18 virtual meeting, after Environment Minister Steven Guilbeault resigned from cabinet over it. Premier David Eby has attacked the Alberta Ottawa agreement as unacceptable, and Prime Minister Mark Carney has been forced into talks with premiers amid trade uncertainty. Polling suggests the public mood is shifting, too, with a slim majority of Canadians, and of British Columbians, saying they would support a new Alberta to West Coast pipeline even if the B.C. government opposed it, and similar support for lifting the tanker ban.
None of this guarantees a new line, or even an expanded one. But compared with last year’s tired trench warfare, the argument now has stakes, participants, and facts. Canadians have woken up to the reality that energy policy is not a culture war accessory. It is industrial policy, trade policy, and national unity policy, all at once.
A new Ontario-wide survey conducted by Nanos Research on behalf of Canada Action finds strong public consensus that Canadian oil and gas revenues are critical to jobs, economic growth, and trade – and that Canada should lean into its energy advantage at home and abroad.
“Our polling feedback shows that a majority of Ontarians recognize the vital, irreplaceable role oil and gas has to play in our national economy. Canadians are telling us they want to see more support for the oil and gas sector, which is foundational to our standard of living and economy at large,” said Canada Action spokesperson, Cody Battershill.
The online survey of 1,000 Ontarians shows that more than four in five (84 per cent) respondents believe oil and gas revenues are important for creating jobs for Canadians and building a stronger economy. Additionally, four-in-five (80 per cent) support Canada developing a strategy to become a preferred oil supplier to countries, while Ontarians are more than eight times as likely to support as to oppose Canada supplying oil and gas, provided it remains a major source of energy worldwide.
“Building new trade infrastructure, including pipelines to the coasts that would get our oil and gas resources to international markets, can help Canadians diversify our trading partners, maximize the value of our resources, and secure a strong and prosperous future for our families,” Battershill said.
Also, nearly four-in-five (79 per cent) of Ontarians say oil and gas revenues are important for keeping energy costs manageable for Canadians.
“Our poll is just one of many in Canada since the start of 2025 that show a majority of Canadians are supportive of oil and gas development. It’s time we get moving forward on these projects without delay and learn from the lessons of our past, where we saw multiple pipelines cancelled to the detriment of Canada’s long-term economic success.”
Additional findings include:
Four-in-five (80 per cent) of Ontarians support Canada supplying oil and gas, provided it remains a major source of energy worldwide.
Four-in five (80 per cent) of Ontarians believe oil and gas revenues are important when it comes to building stronger trading partnerships.
Nearly four-in-five (79 per cent) of Ontarians say oil and gas revenues are important for keeping energy costs manageable for Canadians.
Nearly four-in-five (78 per cent) of Ontarians support Canada stepping up to provide our key NATO allies with secure energy sources.
Nearly four-in-five (78 per cent) of Ontarians support Canada increasing oil and gas exports around the world, about six and a half times more likely than to oppose.
Nearly four-in-five (77 per cent) of Ontarians support Canada providing Asia and Europe with oil and gas so that they are less reliant on authoritarian suppliers.
Nearly three-in-four (74 per cent) of Ontarians support Canada increasing oil and gas exports around the world, five times more likely than to oppose.
Nearly three-in-four (74 per cent) of Ontarians say oil and gas revenues are important to reducing taxes for Canadians.
More than seven-in-ten (71 per cent) of Ontarians support building new energy infrastructure projects without reducing environmental protections and safety.
More than six-in-ten (63 per cent) of Canadians say they are important for paying for social programs, including health care, education, and other public services.
Respondents were nine times more likely to say the government approval process for energy infrastructure projects is too slow (46 per cent) rather than too fast (5 per cent).
About the survey
The survey was conducted by Nanos Research for Canada Action using a representative non-probability online panel of 1,000 Ontarians aged 18 and older between December 10 and 12, 2025.
While a margin of error cannot be calculated for non-probability samples, a probability sample of 1,000 respondents would have a margin of error of ±3.1 percentage points, 19 times out of 20.
