Experts torn over when 'demand destruction' will trigger gas price relief
BNN Bloomberg
There's a famous saying that 'the cure for high prices is high prices,' but when it comes to gasoline, that may not necessarily be the case.
Experts are torn on when or even if drivers might see significant "demand destruction" — an economics term for a sustained decline in demand for a product due to excessively high prices — at the pumps.
In theory, reaching an unsustainable price would serve as a tipping point and ultimately cause fuel prices to fall, finally offering drivers some relief. But analysts say we're not there yet even though gas prices are hovering around all-time highs.
"Canada’s gas prices are at inflation-adjusted records. But I continue to be astonished at the high level of demand we’re seeing," said Patrick De Haan, head of petroleum analysis for the fuel price tracking service GasBuddy.com.
