By Albert Williams
Gas projected to fall below a $1 in a few weeks. COURTESY WIKI COMMONS
Canadians can expect gasoline prices to continue its decline in the coming weeks with predictions of prices falling under a $1.
It would be the first time since 2009 that the price of a litre of gasoline dropped below $1.
OPEC decided not to cutback its output of crude oil following a closed door meeting Thursday morning , according to Reuters.
This inevitably will affect the cost of crude oil which now sits at the lowest it has been for four years at about $75 a barrel.
This latest decision supports the view that there is a rift within the once airtight cartel, which crippled the world with an embargo in 1973.
Iran and Venezuela were just two of the smaller OPEC members that wanted higher prices to help cover their domestic bills.
However, larger countries like Saudi Arabia pushed for lower prices in an attempt to drown out new competitors like the U.S. and Canada.
“Saudi Arabia (is) selling the idea that oil prices in the short term need to go lower, with the floor set at $60 per barrel, in order to have more stability in years ahead at $80 plus,” said Olivier Jakob from Petromatrix consultancy in an interview with Reuters.
“In other words, it should be in the interest of OPEC to live with lower prices for a little while in order to slow down development projects in the United States,” he added.
Jakob implied a price war may benefit consumers in the short-term, but it will cause future oil projects in North America to be uncompetitive because of the high production cost, which will have to trickle down to consumers.
Oil is still the main source of energy. Courtesy Reuters
“This is fantastic!” Christeen Campbell, the Liberal Studies secretary at Humber College said about the current prices at the pumps.
Campbell says she drives to work daily and can’t imagine gas prices going higher than they were earlier this year when it peaked at almost $1.40 a litre. “If this is OPEC’s intention to gauge prices then I will just have to start taking transit more. I would save so much more money anyway.”
William Coyle is an electrician who depends on his vehicle to travel to costumers. He said he has been monitoring the price of oil on the stock market and does not see a correspondence with the prices at the pumps.
“Consumers are just not getting a fair rate on oil prices,” Coyle said. He says the move by OPEC is definitely beneficial to consumers but it has serious implications.
“What about the workers in Alberta, that will affect them negatively,” he said.
Brown-Campbell, a mother who says her world revolves around the various activities her son is involved in, said she is excited when she pulls up to the pumps.
“I was deeply bothered earlier this year when I was spending almost $75 a month for gas,” she said. “If OPEC is planning price gauging there is nothing we can do really. We need gas to get around.”