Bank of Canada governor Mark Carney says the recent run-up of oil prices is a double-loss for Canadians — consumers in the East are paying more for fuel and energy producers in the West are earning less than would be expected.
Carney tells The Canadian Press in an interview that Canada is normally a net beneficiary from higher prices, but the gain has shrunk with the current make-up of how global oil prices are calculated.
And he says the economy will take a hit if gas prices remain at elevated levels for a prolonged period.
The central bank expects to issue a calculation of the impact of global oil on the Canadian economy at its next quarterly monetary policy report in the next two weeks.
Carney says western producers sell at and even below the West Texas Intermediate price, which in March averaged about $24.6 below Brent crude from the North Sea.
Unfortunately, consumers in central and eastern Canada are purchasing gas that contains a mix of the higher-value Brent