Recently, we have noted that U.S. investors are increasingly buying Canadian Oil & Gas companies, even as global oil prices move lower. According to McCrea, U.S. funds now own about 59% of Canadian oil and gas companies, up from 56% at the end of 2024, while investments by Canadians have declined to 34% from 37%. The shift in investments has been even more dramatic for some Canadian companies, with Brian Schmidt, CEO of Tamarack Valley Energy (OTCPK:TNEYF), revealing that U.S. ownership of his company has doubled to 40%, up from 20% before the pandemic while Americans own nearly two thirds of Whitecap Resources (OTCPK:WCPRF) compared to 60% at the end of last year.
There are several reasons behind this “rotation.” First off, Canada’s top leadership is now much open to fossil fuel investments, with Prime Minister Mark Carney promising to make Canada an energy superpower. In contrast, former Canadian PM Justin Trudeau was more friendly to clean energy, managing to provide money to build electric vehicles and charging stations, committing $2 billion for clean water and wastewater funds for cities, introduced a national carbon tax, allocating infrastructure funds for local governments to deal with climate change and imposed a five-year moratorium on oil and gas drilling in the Arctic in the first two years after he was elected.
Second, the completion of the Trans Mountain Pipeline expansion has bolstered confidence in Canada’s oil and gas sector. The expanded pipeline has a total capacity of 890,000 barrels of oil per day, representing a nearly threefold increase from the previous system’s capability. Since its commercial operation began in May 2024, TMX has been running at ~82% of its maximum capacity. TMX carries crude from Edmonton, Alberta, to the Westridge Marine Terminal in Burnaby, British Columbia. From there, it is shipped to global markets, primarily in the Asia-Pacific region. The pipeline also delivers oil to Washington State for local refineries and has terminals in locations like Kamloops and Burnaby for regional distribution.
Related: U.S. Crude Hits a Record While Key Export Data Goes Dark
Third, Canada’s Oil Sands have a significantly lower breakeven point, and can still eke out a profit at oil prices that would make the majority of U.S. Shale Patch companies print red. The average breakeven oil price for Canada’s oil sands is approximately $40–$57 per barrel of crude, with recent estimates suggesting even lower costs for some large producers. Half-cycle breakeven prices can go even lower, ranging from about $18 to $45 per barrel. Recent cost reductions are due to technological improvements and debt reduction, making Canadian oil sands production cost-competitive globally.
Not surprisingly, the Canadian energy sector is outperforming its U.S. counterpart, with the TSX Energy Index up 19.5% in the year-to-date compared to a 6.0% gain by the S&P 500 Energy Index over the timeframe. Here are five Canadian energy stocks that have easily outpaced the market.
#1. Falcon Oil & Gas
Market Cap: $150.1M
YTD Returns: 147.2%
Falcon Oil & Gas Ltd. (OTCPK: FOLGF) engages in the acquisition, exploration, and development of conventional and unconventional oil and gas assets in its portfolio, which includes projects in Australia (Beetaloo Basin), South Africa (Karoo Basin), and Hungary (Mako Trough). The company’s activities focus on finding and developing new resources through exploration and seismic surveys, with the goal of bringing them to commerciality.
Falcon Oil & Gas’ strong performance is being driven by its progress on the Shenandoah South Pilot Project in Australia, which is on track for gas sales to begin in mid-2026, and a recent strategic investment in the Nigerian oil and gas sector by Energy& LLP. The company is drilling faster than forecast, with one well reaching a new record for the horizontal section drilled, thanks to modifications to the mud system and the use of anti-vibration bits. Increased drilling efficiency in Australia and the recent investment in Nigeria are expected to accelerate growth.
#2. Tamarack Valley Energy
Market Cap: $2.7B
YTD Returns: 66.0%
Tamarack Valley Energy (OTCPK:TNEYF) is a Canadian oil and gas company with a long-term strategic focus on responsible, value-driven energy development. The company’s high-quality asset portfolio comprises oil plays in Alberta and several enhanced oil recovery (EOR) opportunities.
Tamarack Valley Energy’s stock has performed well due to a combination of strong operational results, financial discipline, and strategic share buybacks. Tamarack owns high-performing, low-cost assets like those in the Clearwater play, which drive increased production and boost free cash flow. The company has also benefited from divesting non-core assets, a tighter discount on heavy Canadian oil, and an aggressive share buyback program that has reduced the share count.
#3. Imperial Oil Ltd
Market Cap: $49.0B
YTD Returns: 61.9%
Imperial Oil Ltd. (NYSE:IMO) is a Canadian integrated energy company that
explores for, produces, refines, and markets petroleum and natural gas products, including synthetic crude oil. The company is a major refiner and marketer of petroleum products, a large producer of crude oil and natural gas, and a significant producer and distributor of chemical products. They market high-quality fuels, lubricants, and other products under the Esso and Mobil brands and operate a retail network of convenience stores.
Imperial Oil Ltd’s stock has performed well due to its strong operational efficiency, record upstream production, integrated business model, and commitment to significant shareholder returns. This performance has allowed the company to outpace many of its peers in the energy sector. IMO achieved its highest quarterly crude production in three decades during the third quarter of 2025, averaging 462,000 oil-equivalent barrels per day. The record flows were mainly driven by by the Kearl asset, which hit a record 316,000 gross barrels per day
#4. NuVista Energy Corp.
Market Cap: $2.6B
YTD Returns: 38.6%
NuVista Energy Corp. (OTCPK:NUVSF) is an independent oil and natural gas company that
explores for, develops, and produces oil, natural gas, and natural gas liquids in the Western Canadian Sedimentary Basin. Its primary focus is on the condensate-rich Montney formation in the Pipestone and Wapiti areas of Alberta.
Ovintiv Inc. (NYSE:OVV). recently announced an agreement to acquire NuVista Energy Ltd. However, NuVista’s stock performance has mainly been driven by the company’s strong operational execution, sector-leading production growth, and strategic financial management, including share buybacks.
- Peyto Exploration & Development Corp.
Market Cap: $3.2B
YTD Returns: 34.7%
Peyto Exploration & Development Corp. (OTCPK:PEYUF) is a Canadian energy company that focuses on the exploration, development, and production of natural gas, oil, and natural gas liquids. The company’s operations are primarily centered in the Deep Basin area of Alberta, Canada. It generates revenue from the sale of these natural resources.
Peyto Exploration & Development Corp.’s stock has performed well due to its strong operational efficiency, strategic natural gas hedging and diversification, and its low-cost production structure in the Alberta Deep Basin. These factors have resulted in high margins, significant increases in funds from operations, and the ability to return capital to shareholders through dividends and debt reduction, even during periods of lower commodity prices.
By Alex Kimani for Oilprice.com
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