Windsor

Gas prices fluctuating as demand slumps, oil production slows

Gas prices slumped when the COVID-19  pandemic took hold, but have since crept up over the last little while. So what's happening?

Demand for fuel down by 20 to 30 per cent, says expert

COVID-19 has impacted prices at the pump, as demand for fuel drops. (Jonathan Hayward/The Canadian Press)

Gas prices slumped when the COVID-19  pandemic took hold, but have since crept up over the last little while. So what's happening?

The demand has been way down since the pandemic began — by about 20 to 30 per cent — said Dan McTeague, president of Canadians for Affordable Energy.

"We're down to levels of consumption we haven't seen since the 1990s," said McTeague. 

"It has had an impact and it's also left a lot of refiners and producers to cut back dramatically."

McTeague said some oil producers are shutting down capacity due to the low prices and it may mean more imported oil to Canada. That's resulted in higher prices at the pump as the supply slows down. 

For drivers, it's meant some "steep discounts" months ago said McTeague. 

But now, some uncertainty has left prices a bit higher. 

Other factors include the upcoming presidential elections, and some statements made by U.S. President Donald Trump that have resulted in market fluctuations said McTeague. 

"It's bizarre," McTeague said. "But when the president get's sick, and blip in the news cycle, the markets are disrupted."

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