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Crude oil futures closed at $82.75 per barrel on the New York Mercantile Exchange last Friday. Energy prices have been rising in recent weeks due to the perception that the global economy is in recovery mode and that the demand from China and other emerging markets is picking up.

It must be noted that despite the rise in gas prices at the pump in the U.S., demand is still flat to down as people are driving less. Just last week the labor department reported that 15.3 million Americans are unemployed. Unemployment is expected to remain high through the rest of this year. While it is true that China surpassed the U.S. last year as the world's largest market for cars, it is still arguable if the rise in crude oil prices is really due to the demand for crude oil led by China. Last year 10.3 million passenger cars were sold in China due to various government incentive programs that benefited car buyers.

Given the context above, is it a good time to invest in Canadian energy companies?

Canada is one of the most important sources for US energy imports. In fact, most of Canada's electricity, oil and natural gas exports go the U.S. and Canada is also consistently the top supplier of oil to the US. Close proximity to the U.S. and a stable political system are two distinct advantages that Canada has over other crude oil suppliers to the US. The EIA projected that Canada may produce 3.48 million bbl/d this year in the Short-Term Energy Outlook report published in July 2009.

From the EIA site:

"Large oil producers in the country include Imperial Oil, EnCana, Talisman Energy, Suncor, EOG Resources, Husky Energy, and Apache Canada. In 2009, Suncor and Petro-Canada announced that they would merge, creating the largest oil producer in the country, as well as one of the largest producers of natural gas."

Some of the Canadian energy companies are Encana (NYSE:ECA), Suncor Energy (NYSE:SU), Canadian Natural Resources Ltd (NYSE:CNQ), Imperial Oil Ltd (NYSEMKT:IMO), Talisman Energy Inc (NYSE:TLM) and Nexen Inc (NXY). Enbridge (NYSE:ENB) and TransCanada (NYSE:TRP) are major pipeline operators. Imperial Oil is a subsidiary of the U.S. oil giant ExxonMobil (NYSE:XOM).

In summary, since over 99% of oil Canadian exports go the U.S., it is obvious that Canadian oil export growth is closely tied to the health of the US economy. As most economists have projected a jobless recovery this year, investors can wait for a better opportunity to get into Canadian energy stocks.

Source: Canadian Energy Stocks: Now's Not the Time to Buy