But they’ve never been this low before.
On Thursday, the price of Western Canadian Select (WCS), the benchmark price for Canadian oil, dropped to a historic low of US$6.50 Thursday, before dropping even lower to US$4.58 a barrel.
Canadian oil is already priced lower than the North American benchmark, West Texas Intermediate, because it must be transported farther to reach refineries that can handle it. West Texas Intermediate fell five per cent to US$21.46 a barrel Friday, which is also abnormally low.
But not as dismal as WCS.
At the height of the most recent oil boom in 2012, WCS went for over US$100 a barrel. Since the last price crash in 2015, it’s hovered near US$50. The price of WCS averaged around US$36.82 a barrel in January.
And, for context, US$4.58 is around C$6.42 for just under 159 litres of oil.
Here’s an assortment of things that are more expensive than C$6.42 — the price of a barrel of Western Canadian Select in Canadian dollars Friday afternoon:
- six rolls of Charmin toilet paper ($6.97)
- this spray can of avocado oil ($8.99)
- one fifth of a subscription to the ‘Western Canadian’ community newspaper ($10)
- a barrel of monkeys ($15.58)
- a Blu-Ray of the Guy Ritchie film “Lock, Stock And Two Smoking Barrels” ($7.99)
- this little tube of oil paint ($7.33)
- a pocket nature guide to Alberta’s birds ($7.87)
- these little jars that look like oil drums ($15.14)
- 1.42 litres of mayonnaise ($7.58)
- hand sanitizer ($9.13)
- four litres of Coca Cola ($8)
- two rides on Toronto’s public transit system ($6.50)
- a one-month subscription to Netflix Canada ($9.99)
- a two-topping medium pizza (not including delivery) ($7.99)
- an “I <3 Oil And Gas” decorative licence plate frame ($7.95)
In Alberta, the province has staked its most recent budget on high price projections for oil — around US$58.
On Friday, Premier Jason Kenney reiterated a call for the federal government to invest money in bailing out the Alberta oil industry, calling the drop “what will likely be the largest single contraction in [Alberta’s] economy in history.”
These prices are well below the break-even cost for the Canadian oilsands producers, and some experts are predicting prices could drop into the negative, meaning producers would be paying people to take oil off their hands.
So expect oil prices to get even lower.
But that six-pack of toilet paper? That’s a steal of a deal.
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