Canada is one of the largest oil producers in the world with substantial oil reserves contained within its oil sands. According to the Oil and Gas Journal, Canada has around 173 billion barrels of proven oil reserves and at the start of 2015, these reserves were ranked third largest in the world. According to the Visual Capitalist, Canada has around 10% of the world’s global oil reserves.
Canada is also the third-largest exporter of oil with around 99% of its exports going straight to its gas-guzzling neighbour, the US. So, the price of oil has a big impact on CAD. When oil prices are rising, the Canadian dollar is rising. When oil prices are falling, the Canadian dollar is falling. The correlation between the Canadian dollar tends to ebb and flow, but at times the correlation between oil and the USDCAD can be over 95%.
Check out the helpful visual below from the Visual Capitalist for global oil reserve allocations.