Economic impacts of the COVID-19 virus have hit the energy sector extremely hard in the last several weeks.
Gas prices in Regina continue to reflect that reality as they drop due to the virus. Most stations in Regina are selling gas for 76.9¢ per litre, when just weeks ago prices were in the $1.00 per litre range.
Canadians for Affordable Energy President Dan McTeague says while low prices seem helpful in the short term, they put the Canadian energy industry in a bind.
“Behind it is a pretty nasty message for the rest of Canada. With such an important commodity dropping dramatically as it is, it has significant implications which cost more than lower gas prices,” suggests McTeague.
He says people can expect these prices to go even lower over the next few weeks, as no relief from the COVID-19 pandemic is in sight.
Since West Texas Oil is nearing $20 per barrel, it will mean terribly low prices for Canadian oil.
“The oil that we do export in very large amounts to the United States favoured by a good amount of U.S. refineries that prefer heavy oil to light oil – because they can do more with it – is now trending towards $8 per barrel,” explains McTeague.
“Again, those are all-time lows.”
While the prices are a short-term relief for Canadians, McTeague says this will hurt the Canadian economy due to lost tax revenue from Canadian oil sales and at the gas pump.
