If oil prices continue downward trend, gas prices could drop by next week, expert suggests
The price of oil dropped drastically on Wednesday, but drivers still dealing with record-level gas prices at the pump are doing their best to save money.
Todd Prosak was filling up his diesel truck at Canadian Tire Gas+ in Regina on Wednesday morning at $1.83 per litre.
“I drive less, and that’s about all a guy can really do at this point in time,” he said. “Stay home a little more often, do some walking, do some biking.”
Prosak lives in Saskatoon but has to travel for work. He’s aware that the price of gas has spiked largely because of the ongoing war in Ukraine following the Russian invasion nearly two weeks ago, and said he understands.
“I’m just thankful I’m not in a bomb shelter in Ukraine, and that I drive a [Honda] Civic,” said Pauline Gabriel, a driver at the Regina Cabs gas station pump in central Regina.
Jason Mancinelli, owner of Driven Automotive in Regina and a city council member, said there are small ways to reserve fuel.
He said they can range from planning routes, to ensuring your tires are properly inflated — hopefully winter tires, which provide more traction — and reducing vehicle weight by emptying junk from a vehicle’s trunk or removing rooftop carriers.
“If you ever carried a wheelbarrow with a flat tire and a load on it you’ll realize right away how important tire pressure is,” Mancinelli said.
The City of Regina said in an email it buys more than seven million litres of fuel each year and the current fuel prices “represent a 55 per cent increase in the fuel price compared to our budgeted fuel price.”
“If today’s fuel prices remained the same for the rest of the year the city’s fuel cost would be expected to be approximately $4 million above budget.”
It said the city would be monitoring fuel costs throughout the year and looking for ways to offset costs as required.
Oil prices suddenly drop
Since March 1, gas prices have risen by more than 20 cents per litre in Saskatchewan, according to GasBuddy, a company that reports fuel prices at gas stations in Canada among other countries.
It’s reporting an average gas price of about $1.72 between Regina and Saskatoon as of 4:45 p.m. CST on Wednesday.
Dan McTeague, who is president of Canadians for Affordable Energy and runs a gas prediction website, said if the price of oil continues to trend downwards after a drastic $15 per barrel decrease throughout Wednesday, consumers might feel better next time they’re fuelling up.
“I’ve never seen a barrel of oil drop $12 [US] in a span of 10 hours,” McTeague said early Wednesday afternoon. “This market is insane.”
McTeague said the Ukrainian-Russian conflict has largely caused the recent increase in oil prices, which rose to more than $120 per barrel on Tuesday. As of about 4:45 p.m. CST on Wednesday, the West Texas Intermediate (WTI) Crude price of oil, which is the North American oil benchmark, was about $109 per barrel.
McTeague said Saskatchewan gas markets are often delayed, but, “I would expect that we could be back down to $1.50 [per litre] over the course of the next seven days if these trends continue.”
The rapid rise and sudden drop in oil prices makes it difficult to predict trends, McTeague said, and he wouldn’t venture to make any predictions about gas prices going forward into the summer, comparing it to picking lottery numbers.
Opposition calls for financial support
The provincial Opposition asked the government to support consumers with a provincial gas relief program on Monday and echoed those calls on Wednesday.
“The government certainly has the ability to act here, they have the revenues to act,” Trent Wotherspoon, NDP finance critic, said Wednesday.
Wotherspoon said the provincial government needs to address fuel costs and the cost of living, including reducing or suspending the provincial fuel tax, or a rebate for food and fuel prices.
The Alberta government announced on Monday it would pause the provincial fuel tax of 13 cents per litre on April 1. The suspension will remain in place until the price of West Texas Intermediate crude oil falls below $90 per barrel.
Premier Scott Moe said on Monday the rising oil prices in the province indicate that Canada needs to become more self-reliant for oil, referencing Russian oil imports, which are being banned in Canada.
“We need to take care of ourselves. We still import oil from other areas of the world, including Russia, into Canada and that needs to stop,” he told reporters.