Canada’s natural gas and oil industry could undergo dramatic challenges as the world transitions to net-zero emissions, with production plummeting sharply by 2050, according to the nation’s energy regulator.

The Canada Energy Regulator (CER) on Tuesday published Canada’s Energy Future 2023 (EF2023), which explores what might unfold in the quest to reduce greenhouse gas (GHG) emissions.

“In a net-zero world, not only for Canada but for the rest of the planet, the supply and demand dynamic that we see today will be very different in the future,” CER chief economist Jean-Denis Charlebois said Tuesday. “Because there will be less demand for hydrocarbons, producers of hydrocarbons will need to be increasingly efficient at managing their costs in order to remain...