News

Gas prices may dip below $1/L for the first time in 5 years

QMI Agency

(Tony Caldwell/QMI Agency photo illustration)

(Tony Caldwell/QMI Agency photo illustration)

Canadian drivers are seeing something they haven't seen in years — gas prices below $1 per litre.

Prices already dipped as low as 97.4 cents in Edmonton this week, and prices as low as $1.01 were spotted in Ottawa, continuing to edge ever lower.

In fact, much of the country could see the price at the pump get to under a loonie as early as this weekend.

That would be the first time that's happened since 2009.

Analysts say an overabundant supply has caused crude oil prices to plummet in recent months.

"The game changer has been Canada and the U.S. unleashing their crude resources," said Dan McTeague, senior petroleum analyst with gasbuddy.com. "There is now a global surplus of two million barrels a day."

Pair that with vehicles that are much more efficient, leaving demand for gasoline and diesel fuel static, at about 75 billion litres per year.

With an average price of $1.13 already, consumers are saving about $20 per week compared to the summer, McTeague said.

Even lower prices depend on what the Organization of the Petroleum Exporting Countries (OPEC) decides on possible production quotas this week.

A drastic cut in production could send prices at the pumps back upwards. But if there is little or no change in production, as McTeague expects, we can expect a further price drop of 3-4 cents per litre.

Every little bit helps Bruno Campagiorni of Niagara Falls, Ont., who has three vehicles in his family and spends at least $100 a week on gas.

"It's nice to get this kind of a break in the winter," he said filling up Wednesday. "When gas was at $1.35 you had to think twice before going anywhere."

And because demand remains low in the winter months, prices aren't expected to bounce back until March.

- with files from Tony Ricciuto


Reader's comments »

By adding a comment on the site, you accept our terms and conditions