This is probably the most commonly asked question in business circles around here these days: how will the latest volatility in energy markets affect us?
It’s still too early to tell how the impact of falling oil prices triggered by the price war emerging between OPEC and Russia will hit us but there’s no doubt we will feel it. It’s too early to tell because we really don’t know where this will settle out …will the warring factions find their way to the bargaining table? Will new supply from Brazil, Norway and the US – sparked by the rising oil prices earlier in the year – actually find its way to market or will they pull back in light of lower prices?
Until we get answers to these questions, we are going to be guessing about the magnitude of the impact but there’s no doubt that we will feel something. That certainly is the view of the economists at TD Bank who this week said they are in the process of revising their forecasts with an expectation of significant downward revisions for the oil producing provinces of Alberta, Saskatchewan and Newfoundland.