While the rout in oil has sharpened the focus on economic fallout, Canada tops the list as the largest consumer of energy per capita among the Organisation for Economic Cooperation and Development countries, meaning that trends in the energy needs of consumers and industries alike paint a fuller picture of the country’s outlook, says a report from CIBC World Markets. “The dramatic collapse in crude has lines drawn between winners and losers,” says Benjamin Tal, CIBC deputy chief economist. “And, though the nation’s emergence as an energy powerhouse has the negatives coming into sharper focus, there will be spoils to be shared in Canada.” Canada is not only a major energy producer, but it also consumes more energy than any other major industrialized country. The report points out that this level of energy consumption could have been much higher if not for the meaningful decline in the country’s overall energy intensity. Canada’s economy uses 25 per cent less energy per unit of GDP today than it did 20 years ago, but over the past decade, energy intensity stabilized, as energy consumption in the oil patch and manufacturing sectors virtually cancelled each other out, reflecting the past decade’s growth in one and downsizing in the other. Canadian manufacturers, meanwhile, generally use electricity and natural gas rather than oil-based fuels so the drop in oil prices will have very little direct impact on the cost of production, the report says. That said, given that natural gas prices will likely remain low compared to electricity prices, certain manufacturing sectors that are natural gas-intensive, such as chemical fertilizer producers and the forestry industry, will be among the biggest winners, it says.
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