Enjoy price relief at Alberta gas pumps while it lasts, analysts say
Experts predict prices will continue downward but the dip won't last long
Gasoline prices have been coming down in Alberta over the past week and prices could drop even more in the days ahead, according to analysts.
Prices have eased since hitting record highs this summer. The provincial average for a litre of regular-grade gasoline now sits at around $1.705, down seven cents in the past week.
Alberta boasts some of the cheapest gas prices in Canada, according to GasBuddy.
"I do think there's additional downward momentum. We could see prices falling maybe another five to 10 cents per litre in the weeks ahead," said Patrick De Haan, head of petroleum analysis at GasBuddy.
Prices jumped earlier this summer along with the price of oil, which has since pulled back.
"As oil prices fall, gasoline prices typically fall within one to two weeks thereafter, and that's why we're seeing relief at the pumps," said Jeremy McCrea, managing director of energy research at Raymond James.
"The volatility that we're seeing in the oil markets right now is unbelievable. We've never really seen this type of volatility," said McCrea.
"The financial markets are pushing down the price of oil while the supply side and the physical market is pushing it up, and this is why we're seeing the volatility," he said.
And that volatility means the price could easily jump again in the near future.
Extreme weather events like hurricanes and positive economic data out of the United States could also slow the recent price decline.
"Beyond a week or two, it gets a little bit murky because of the amount of economic data coming out of the U.S., which is a catalyst for prices in Canada," said De Haan.
De Haan says the release of new U.S. GDP numbers and the possibility of the federal reserve raising interest rates could see gas prices in Canada head north again.
Diesel prices in Alberta are higher than gasoline, averaging around $1.82 per litre, which De Haan says is around 10 cents higher than gasoline.
Consumers in Alberta are being urged to take advantage of price volatility between stations and fill up whenever they see a deal.
"When prices go up, there's not a whole lot of variety in prices. But when prices fall, stations can pass along the lower prices as quickly or slowly as they want, creating a larger gap between the highs and lows," said De Haan.