In late 2014, global oil prices plunged dramatically. From early October 2014 to early February 2015, crude prices fell by nearly 50%, driven largely by a worldwide oversupply. The shock rippled through the entire energy market.

The primary driver behind this drop was OPEC’s response to rapidly rising U.S. oil production. Over the previous decade, the United States had steadily increased output, reaching production levels 50% higher than in 2006 — thanks largely to the expansion of hydraulic fracturing for shale oil.

With more oil on the market than global demand required, the typical response would have been for major producers to cut output. Instead, in November 2014, OPEC chose to maintain production targets. Historically, Saudi Arabia acted as a swing producer to stabilize prices, but this time it refused to reduce output. At the same time, Libya’s production rebounded to pre‑conflict levels, and Iraq reached its highest output in 35 years. The result was an even greater oversupply — and a dramatic collapse in crude prices.

At the pump, Canadians felt the impact almost immediately. Gasoline prices dropped across the country, in some regions by as much as 25%. Drivers enjoyed a rare moment where the litres counter spun faster than the dollar amount. But the relief was short‑lived: by February 2015, gas prices began climbing again.

This leads to a natural question: if crude oil fell by 50%, why did gasoline only drop by half that amount? As with most things in the energy world, the answer is complex. Our next article will explore the relationship between oil producers, refineries, and retailers — and shed light on the long, intricate journey hydrocarbons take from the well to the pump, including the role governments and energy corporations play along the way.