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A distortion between what Canada pays to import oil and what it gets paid to export oil is costing the Canadian economy $2.5-billion each month, estimates one economist.

“Despite being an important crude oil producer, Canada still has to import more than 40% of the oil it consumes because of an inadequate pipeline network,” said Charles St-Arnaud, economist with Nomura Securties International.

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Mr. Nomura said that as a result of the oil price distortion, the Canadian economy is losing out on revenue of roughly $30-billion a year, or 1.6% of GDP. The current spread between what Canada gets for its exported oil and what it pays for imported oil is roughly $50 a barrel. Historically, the spread has been closer to $10-15, says Mr. St-Arnaud.

Many eastern and central provinces, such as manufacturing hub Ontario, import oil because the infrastructure does not exist to pipe in Alberta’s heavy oil and refine it. As a result, such provinces often pay for oil based on Brent prices, an international benchmark which tends to cost more than North American oil.