Stocks of Canada’s two largest oil companies, Suncor Energy (TSX:SU) and Canadian Natural Resources, jumped in 2026 on another Trump shock. The United States began 2026 with the capture of Venezuelan President Nicolás Maduro, which triggered a new oil supply shock that affected the Western Texas Index (WTI) crude price. The first reaction was a dip in Canada’s oil stocks, as Venezuela is a competitor. However, opportunists saw value in the global shift in oil trade, and Canadian oil stocks surged.
Suncor Energy is Canada’s largest integrated oil company, which gives it an advantage over others. Its upstream operations involve oil exploration through oil sands mining and oil refining. Its downstream operations involve selling refined oil in retail markets under the Petro Canada brand. When the Western Canadian Select (WCS) and WTI prices are high, the upstream generates higher revenue. When oil prices fall, the downstream generates higher revenue.
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How oil stocks play out in 2026
Ever since the 1980s, oil has been the most controversial commodity because it is pegged to the US dollar, popularly called the petrodollar. The value of the US dollar is sensitive to oil trades as the Organization of the Petroleum Exporting Countries (OPEC) sells oil to the world in US dollars. When the petrodollar was challenged, the US used its geopolitical leverage to impose sanctions to protect the petrodollar.
Before 2007, when the US imposed sanctions on Venezuela, the latter used to import Venezuelan oil and refine it. However, sanctions forced ExxonMobil and ConocoPhillips out of Venezuela. Over the years, Canadian crude replaced Venezuelan oil in US refineries. US President Donald Trump is looking to reclaim Venezuela’s oil.
Although there are barriers, such as significant capital investment of US$110 billion in infrastructure and political uncertainty, the opening of the Venezuelan market creates competition. US oil company Chevron is tapping the Venezuela oil opportunity.
Canadian oil was already competing with US shale gas exploration, which began in 2016. Suncor survived the 2016 oil crisis by reducing production costs through financial discipline and optimization. After a decade, new competition has emerged from Venezuela. But this time, the Canadian government is diversifying its trade partners.
Canadian Prime Minister Mark Carney visited China to open dialogue for a new trade relationship in agriculture, energy, and finance. It is important to note that Canada imposed tariffs on China and faced reciprocal tariffs from China to align its foreign policies with the United States.
Investors should watch for developments in China-Canada trade relations, as new markets could become available to Suncor, which currently relies heavily on exports to the US. Broadening its export base may alter Suncor’s longer-term outlook and risk profile.
Outlook for Suncor stock in 2026
While a shift in global trade is long-term, 2026 could be a year of high trading volumes for Suncor stock. Suncor provides investors with exposure to WTI crude prices while ensuring steady dividend income.
This year could bring a lot of back-and-forth between the US and Canada at the negotiation table as both try to strengthen their bargaining power. If the US is looking to diversify oil suppliers, Canada is looking to diversify trading partners. This competitiveness will enhance costs and create opportunities, which Canada refrained from exploring earlier in order to retain good relations with the US.
Ideally, 2026 should have been a year of normalization for Suncor, with the company expecting WTI crude prices to stabilize at US$62, down from US$66.65 in the first nine months of 2025. However, evolving geopolitical factors have shifted the North American oil outlook. Suncor’s previously range-bound stock could now see significant volatility, as it did in 2022, after the Russia-Ukraine conflict disrupted global oil supply chains.
Is Suncor stock a buy near its 52-week high?
Suncor stock has rallied 10% so far this year and is overbought with a Relative Strength Index (RSI) of 75. The RSI measures the last 14-day trading activity and determines if the stock is overbought at an RSI above 70 or oversold at an RSI below 30.
Oil is cyclical, and the stock could fall at any time. However, it is a stock to buy at the dip as 2026 could see sudden rallies on government announcements and foreign policies. This is a stock to trade in 2026. However, if you are a long-term investor who already owns Suncor stock, consider holding it instead of adding more.
As Warren Buffett says, “Be fearful when others are greedy”. Now may be that time. The best thing to do in a volatile market is to do nothing. Do not panic sell or buy in greed, just keep holding.
