Economies in parts of Canada could suffer due to falling prices of oil, according to experts.
As of Tuesday, oil traded at $44 per barrel, down to less than half of what it sold for in 2013.
The Conference Board of Canada predicts this drop will cause Alberta to slip into a recession by the end of the year. Jeff Rubin, the author of "The End of Growth" and former chief economist of CIBC World Markets believes the dip in the sector could affect Saskatchewan as well, though not as seriously.
"I don't expect Saskatchewan or Newfoundland to be as adversely affected as Alberta," Rubin said.
"But it's going to impact the economy, it's going to impact tax revenues. Governments are going to be challenged in the sense that if they don't challenge spending, they'll see their deficits go off side."
It could also affect property prices.
The Conference Board of Canada predicts that Alberta will slip into a recession before the end of the year. Rubin echoes that warning. He said Alberta could experience its worst recession since the late 1980s.
'World economic growth and world oil demand is slowing down dramatically, and I think this is the new oil market that we have to come to terms with.' - Jeff Rubin
The declining economic situation doesn't look like it'll improve, he said.
"World economic growth and world oil demand is slowing down dramatically, and I think this is the new oil market that we have to come to terms with," Rubin said.
The silver lining
Despite these losses in the oil and gas sector, Rubin said the Canadian dollar could see a dip to about $0.75.
While this isn't good news for oil prices, it is for the manufacturing sector.
"It's going to breathe new life into what's been a hollowed out manufacturing sector in this country," he said. This includes Saskatchewan.
There are a couple of ways governments and the oil and gas industry can work to recover losses, though.
Cut back and tax: Rubin
The surplus in worldwide oil markets is weighing on the price, Rubin said. It will remain until there are cuts in production from high cost producers, including in the oil sands.
To mitigate losses, Rubin suggested the oil and gas sector needs to cut back, rather than expand.
"So far, there's no appetite to do that," Rubin said.
He suggested that governments should take the opportunity to follow British Columbia's lead and tax carbon consumption, instead of relying on royalties.
The B.C. government has successfully taxed carbon for nearly a decade, he said.