The rise in gasoline prices in Saskatchewan and across the country is due to an anticipated reduction in oil production, particularly in Russian territory.
According to visiting professor in the Department of Economics at the University of Ottawa, Jean-Thomas Bernard, this market anticipation stems from the economic sanctions imposed on Russia.
In less than a week, the average price of gasoline at the pump has increased by about 20 cents in Saskatchewan.
To adjust to the drop in production, the solution is therefore to reduce motorists’ gas consumption by increasing the price of gas at the pump.
While some suggest that politicians reduce gasoline taxes to accommodate consumers, this expert explains that this would go against the adjustment mechanism. The purpose of rising oil prices is to reduce gasoline consumption, not increase it.
We don’t want consumers to continue to increase their consumption. We must encourage them to consume less“, specifies Mr. Bernard.
© Noémie Rondeau/Radio-Canada
According to the professor of strategies at the Faculty of Administration of Laval University, Yan Cimon, consumers can use public transit to reduce the financial consequences of rising oil prices.
To reverse this upward trend, Jean-Thomas Bernard observes that a reasonable agreement between Ukraine and Russia could lead to an immediate drop in the price of gasoline at the pump.
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We could observe a fall in the price of the barrel of the same amplitude as that which we observe on the rise“, underlines the visiting professor in the department of economics.
Solutions for the consumer
According to the professor of strategies at the Faculty of Administration of Laval University, Yan Cimon, several solutions are available to mitigate the financial consequences of the increase in the price of gas at the pump.
In the medium and long term, Yan Cimon explains that a reflection is necessary to evaluate the various more ecological alternatives, in particular the shift to electric vehicles.
For the time being, Mr. Cimon recommends that consumers travel via active means of transport or use public transport.
For those who travel with a combustion vehicle, Yan Cimon suggests that they make trips profitable by carpooling or by forming a group of friends to spread the costs and carbon emissions over several people.