The drop in oil prices over the weekend will go down as the worst in Canadian history.
That’s according to Tim Pickering, CIO of Auspice Capital, who says the WTI price dropped by as much as 25 per cent on Sunday.
Some reports suggest this is the biggest loss since the Gulf War.
Pickering tells Mix News Canada’s economy will be severely impacted from this.
“Definitely conceivable that it could do significant and potentially irreparable damage to the Canadian economy given the significance of oil as an important part of our exports.”
The Canadian Dollar could also see a significant drop. Pickering adds it has already lowered by one per cent but this could change in the near future
The drop in prices is being linked to three reasons.
The coronavirus, Russia not agreeing to OPEC’s proposed production cut of 1.5 million barrels per day, and Saudi Arabia increasing its production.
Pickering isn’t holding his breath on Russia and Saudi Arabia cutting production anytime soon.
“Saudi Arabia and Russia appear to be pointing fingers at each other… Russia and Saudi Arabia are closely linked nations. I think we have to be realistic in North America about that.”
He notes if the two countries do reduce their output, this could have a positive impact on global prices.