As stock markets took a hit and world oil prices plummeted Monday over global concerns about COVID-19, things weren’t looking quite as gloomy for Winnipeg drivers.
The sharp drop in world oil prices led to a drop of prices at pumps around the city.
“It’s below a dollar a litre and prices will only continue to drop from here on out until something happens, until we know what’s going to happen,” said Allison Mac, a petroleum analyst at GasBuddy.
“We’re heading into spring, we’re heading into summer, prices tend to go back up. But since mid-February … we’ve been seeing oil prices continue to drop.”
Mac said gas prices had fallen at Winnipeg pumps Monday by an average of 5 cents a litre over the same time last week, and as of Monday afternoon the cheapest posted price sat at 89.9 cents a litre, according to GasBuddy.com.
As the novel coronavirus continues to spread around the world, several countries have imposed strict quarantine measures, including limiting travel, causing a drop in the demand for oil.
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Dan McTeague, president of Canadians for Affordable Energy, said the COVID-19 outbreak has probably accounted for a 40-per cent drop in the price of oil, which in turn has given rise to an average 15-cent-per-litre decrease in Canada.
Mac said while fears over COVID-19 led to the start of softening of prices a the pumps, a dispute between the Organization of the Petroleum Exporting Countries (OPEC) and Russia that came to a head Monday has also played a role.
“We woke up this morning and we heard about the price war between the Saudis and the Russians and now a barrel of oil is only $32,” she said.
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“So we’re seeing gas prices drop, oil prices drop, and really a lot of drop in prices.”
The price of oil sank nearly 20 per cent after Russia refused to roll back production in response to falling demand and Saudi Arabia signalled it will ramp up its own output.
The sudden drop in oil prices also caused havoc on the markets Monday, with both the New York Stock Exchange and the Toronto Stock Exchange forced to temporarily pause trading after stocks plunged at the market open.
Rob Tétrault with Canaccord Genuity Wealth Management in Winnipeg said while the financial news may look grim at the moment, it’s far from time to panic.
In fact, Tétrault says now is the perfect time to invest.
“We don’t know when the bottom will be but when we reach the bottom we know the market will turn,” he said Monday.
“And when it does turn 100 per cent of the time in the last 100 years when we see these types of corrections, we see highs.
“There’s some incredible buying opportunities now and I would be calling your adviser or portfolio manager and be looking for some opportunities right now.”
— With files from Amber McGuckin and Hannah Jackson
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