Skidding oil prices are shaking consumers’ confidence in time for the holidays, most acutely in the Prairies, where fears are mounting about a prolonged downturn for energy prices.
For the third month in a row, the Conference Board of Canada’s national Index of Consumer Confidence fell. “This month’s decline was driven in large part by a drop in the Prairie region,” the Ottawa-based researcher said.
“The results were not unexpected given the rapid and severe decline in crude oil prices over the past month,” the board’s report said.
Alberta, Saskatchewan and Manitoba – collectively the Prairies – reported a steep drop of 13.6 points in the region’s November showing, down to 91.6 points. That compares to a decline of 1.4 points nationally, to 82.7. The region, and Alberta in particular, is the epicentre of Canada’s energy industry.
MORE: The winners and losers from crashing oil prices – for now
Consumers well aware
The Conference Board has published its survey-based index since 1960. The current reading uses a base year of 2002, with a reading of 100. A point total above that number or below means confidence is either higher or lower than the base period.
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In September, when oil’s current slide was just gathering steam, the Prairie index reading was 114.4. Global oil prices have fallen sharply since – registering a 13 per cent decline last week alone.
’Positive’ effects?
In an interview with Global News’ The West Block on Sunday, federal Finance Minister Joe Oliver suggested consumers have less to fear in the near term than oil companies or governments who rely on the sale of oil for revenue and taxes.
MORE: Lower oil prices threaten government revenues
There’s some “positive” effects on the economy as well, Oliver suggested, including more money in consumers’ pockets for spending and lower operating costs for manufacturers.
“It isn’t only a negative thing,” the minister said. “It has positive implications for the economy as well.”
WATCH: Finance Minister Joe Oliver talks to Tom Clark about consumer debt, plummeting oil prices and the Canadian economy
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