Oil prices will shave $15 billion to $20 billion from Canada’s economy annually if they stay at current, lower levels, the Bank of Montreal says.
But oil prices could still fall further; analysts warn they could decline another $10 a barrel, to $60 U.S., following OPEC's decision this week not to shore up prices.
The warning came as the Toronto Stock Exchange headed for another day of losses. A better-than-expected GDP report wasn’t enough to offset markets’ fears that an oil price collapse will hurt Canada’s energy exports.
January crude oil futures on the New York Mercantile Exchange hit a 4 ½-year low, at $69.32 a barrel. That sent the TSX down 80 points to 14,842.2 as of mid-morning Friday.
The loonie lost another 0.65 of a cent, falling to 87.6 cents U.S.
In a client note Friday, BMO chief economist Doug Porter estimated that the recent 30-per-cent decline in oil prices will translate into a 25-per-cent decline in Canada’s trade surplus.
“If sustained, these lower crude costs could carve Canada’s trade surplus by $15-20 billion alone (or about one per cent of GDP). Ouch,” Porter wrote.
But what’s bad news for Canada’s oil exporters is good news for consumers and for the U.S., still an oil importer despite the massive boom in shale oil production.
Gas price watchers are calling for a nosedive in prices this weekend, following OPEC's decision.
Some areas in the Prairies are already seeing gas prices below $1 per litre and many other parts of the country could soon follow, according to forecasts.
Meanwhile, U.S. stock markets took the oil price rout in stride, and indexes were higher as traders returned to work following the Thanksgiving holiday for a shortened session.
The Dow Jones industrials gained 58.8 points to 17,886.55, the Nasdaq improved by 15.01 points to 4,802.33 while the S&P 500 index declined 0.36 of a point to 2,073.19.
— With files from The Canadian Press
But oil prices could still fall further; analysts warn they could decline another $10 a barrel, to $60 U.S., following OPEC's decision this week not to shore up prices.
The warning came as the Toronto Stock Exchange headed for another day of losses. A better-than-expected GDP report wasn’t enough to offset markets’ fears that an oil price collapse will hurt Canada’s energy exports.
January crude oil futures on the New York Mercantile Exchange hit a 4 ½-year low, at $69.32 a barrel. That sent the TSX down 80 points to 14,842.2 as of mid-morning Friday.
The loonie lost another 0.65 of a cent, falling to 87.6 cents U.S.
In a client note Friday, BMO chief economist Doug Porter estimated that the recent 30-per-cent decline in oil prices will translate into a 25-per-cent decline in Canada’s trade surplus.
“If sustained, these lower crude costs could carve Canada’s trade surplus by $15-20 billion alone (or about one per cent of GDP). Ouch,” Porter wrote.
But what’s bad news for Canada’s oil exporters is good news for consumers and for the U.S., still an oil importer despite the massive boom in shale oil production.
Gas price watchers are calling for a nosedive in prices this weekend, following OPEC's decision.
Some areas in the Prairies are already seeing gas prices below $1 per litre and many other parts of the country could soon follow, according to forecasts.
Meanwhile, U.S. stock markets took the oil price rout in stride, and indexes were higher as traders returned to work following the Thanksgiving holiday for a shortened session.
The Dow Jones industrials gained 58.8 points to 17,886.55, the Nasdaq improved by 15.01 points to 4,802.33 while the S&P 500 index declined 0.36 of a point to 2,073.19.
— With files from The Canadian Press