Watch above: People are pleased to be saving money at the gas pumps these days but it’s not all positive. Aaron Streck takes a look at the downside of low gasoline prices in Saskatchewan.
SASKATOON – It’s quite a sight for motorists, prices at the pumps under a dollar a litre. It’s been creeping lower and lower since the price of oil started to plummet. While it’s expected to be even lighter on the wallet there are some negatives.
Rick Slade wants every last drop, filling his truck at 98.9 cents a litre saves him about 20 dollars.
“I hope it goes lower, the lower the better,” said Slade. “We make it, we refine it, we do it all here in Saskatchewan and Alberta, it’s all done here so why should we have to pay all this money for gas when it’s in the ground right here.”
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Gas is at a four-year low, the drastic drop in the last month hasn’t had a huge effect on Simpkins’ Market Garden just yet.
“There’s always expenses in other areas but it is a little easier to balance the books. Depending on the year, it can be anywhere like 10 to 15 thousand dollars a year just for the production side of it, not even transportation,” said Simpkins Market Garden’s Dixon Simpkins.
Economist’s say prices at the pumps are expected to continue to plummet, possibly dropping into the 70 cents/litre area.
“Compared to last December, we have had about 23 percent lower gas prices in Saskatchewan which is very good news for consumers in Saskatchewan, big gas consumers compared to the rest of the nation. How low will it go depends on fundamental factors on the oil market,” said Dr. Saeed Moshiri, an economics assistant professor at the University of Saskatchewan .
Despite the short term consumer gain, it’s not all positive. Saskatchewan Premier Brad Wall has made it clear there will be more belt tightening in next years budget if the price of oil doesn’t rebound.
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“There was a time where you could say these one, two or three things would identify what the future of Saskatoon or Saskatchewan economy looked like. There way too many moving parts today to be able to say it’s one thing, there are several at play today,” said Kent Smith-Windsor, executive director of the Greater Saskatoon Chamber of Commerce.
“Lower oil price benefits oil importing provinces like Ontario and Quebec, that helps manufacturing but high oil price obviously helps us,” said Moshiri.
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For now 97.9 cents a litre at the pumps is having the biggest impact on the day to day commuters but it could come back to haunt us all in the long haul.
The average price of gas in Saskatchewan on Dec. 4 was 103.2 cents a litre.
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