Gas, heating oil prices to get worse: analysts

If you think gas prices are high now, oil industry analysts are warning that you shouldn't hold your breath.

“Fill up your basement,” said Calgary-based analyst David Yager when asked how Nova Scotia consumers should react to prices ranging from $1.47 a litre for regular unleaded in Halifax to $1.49 in Cape Breton.

“…with the world recovering and opening up, demand is going to continue to outstrip supply so there's no one seeing, even in the futures market, any material relief in the oil price any time soon.”

The debate isn't about whether, but how much the price will increase.

In a forecast that made national news last week, analyst Dan Mcteague predicted that supply constraints and increasing demand would combine with next year's ratcheting up of the carbon tax and a new federal clean fuel standard to drive the price at the pump up to $2 a litre by December 2022.

For his part, Yager wasn't willing to make such hard predictions.

“After studying oil forecasts for 42 years the only thing I can assure you is that they're always wrong, the question is how much and in what direction,” said Yager.

“But the current supply/ demand balance leads me to believe you'll see no relief in oil prices the next three to four years, and that seems to be the consensus view. As matter of fact you'll likely see a severe oil shortfall in 2023, 2024 and 2025.”

It's not just at the pumps that we will feel the pinch.

Mike Macdonald has been preparing for the hard winter to come.

The chair of the Antigonish Emergency Fuel Fund sees rising heating oil prices combining with bigger grocery bills (in part due to transportation costs), general inflation and housing costs to put low income Nova Scotians in a real bind this winter.

“Folks are already operating on very small margins,” said Macdonald.

The charity supports some 350 families in Antigonish

County with home heating — be it oil, wood or electricity. Over its 14 years in existence, Macdonald has seen the numbers on the list wax and wane according to economic conditions and energy costs. Many are working poor who get hit both by the need to heat homes and fill a vehicle.

“The majority of our clients are single mothers, we always prioritize them,” said Macdonald.

“It's early in the season yet, but yes, we fully expect demand to be up this year.”