Plummeting oil prices Monday sent shockwaves across the oil industry and Premier Jason Kenney held a press conference Monday to respond.
Kenney said COVID-19 is causing a slow down in the global economy and as the virus spreads around the world, the demand for oil is dropping for the first time in more than a decade.
“I understand this is the first time since 1930 that the world has seen a significant decline in energy demand met concurrently with a significant increase in energy supply,” said Kenney.
“We are in uncharted territory. This couldn’t come at a worse time after five years of economic decline and stagnation in our province."We are in uncharted territory. This couldn't come at a worse time after five years of economic decline and stagnation in our province." -Premier Jason Kenney Click To Tweet
“Economic fragility combined with a global recession and a collapse in prices constitutes a profound challenge for Alberta and for Canada. This will obviously be a very difficult time for everyone in our energy sector and will affect the broader Alberta economy.”
LIVE: Responding to COVID-19 (Coronavirus), oil prices, and the global economy. https://t.co/aG5txDNofw— Jason Kenney (@jkenney) March 9, 2020
Kenney also said the current situation may impact Alberta’s financial plan.
“Our priority is protecting jobs,” said Kenney. “Our priority is protecting the economy and if that means that in the mid-term we need to borrow money to make that happen, we will do so.”
Kenney said in the second quarter the province will likely come forward with an economic update that includes revised fiscal projections as well as a package of additional measures to protect jobs in Alberta.
Kenney said he will go to Ottawa later this week to present several actions to the federal government urgently needed to help protect Alberta’s economy from the oil price collapse and the global downturn.
Kenney also said that introducing a PST isn’t something he is considering.
He said all options will be on the table to help protect jobs and Albertans, including further acceleration of infrastructure spending.
On Monday, oil was about $31.13 per barrel. Canada’s energy sector accounts for more than 11 per cent of Canada’s gross domestic product.
North American stock markets stopped Monday morning just after opening because circuit breakers created to slow down panic selling started up within minutes of opening. This is the worst day for the TSX since the financial crisis.
The TSX lost eight per cent, more than 1,400 points, minutes after opening, triggering the Canadian index’s circuit breaker.
-George Brownwell / Alberta Press
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