By David Boles, Local Journalism Initiative Reporter, St. Albert Gazette
Drivers across Alberta are experiencing sticker shock at the price of gas, and data seems to indicate the price at the pumps may not be done rising.
“The Canadian average is now at about at $1.87 a litre,” said Gasbuddy Head of Petroleum Analysis Patrick DeHaan.
A barrel of West Texas Intermediate closed trading on Monday, May 4, at over $104, while Western Canadian Select was well over $78 a barrel.
Prices are likely to keep rising, as DeHaan says the war in Iran has caused supply issues, impacting global oil markets by 18 to 20 million barrels a day.
Another issue affecting things in Alberta and the rest of the Canadian prairies are major issues with refineries in the United States.
“Some of those refinery issues are temporary in nature. Some of them may be longer lasting,” said DeHaan.
To provide relief at the pumps, Prime Minister Mark Carney announced last month that the federal government has suspended the tax on gasoline and diesel, which the PMO expects to save 10 cents a litre on gasoline.
In Alberta, the UCP government is considering removing at least part of, if not all of, the provincial gas tax as legislated under the Fuel Tax Relief Program.
A statement from the Ministry of Finance, Nate Horner’s office says a review period will run from May 15 through June 15 for the quarter beginning July 1. The current legislation dictates that if oil prices exceed $90 a barrel, the fuel tax is lifted.
According to GasBuddy data, Alberta currently has the lowest gas prices in Canada.
However, DeHaan says all of that may not matter if the Strait of Hormuz stays logjammed.
“Oil prices can continue to go up until demand drops, and there’s no telling if that point is $130, $150, or even $200 a barrel,” said DeHaan. “That’s kind of the unnerving part of this is that the sky is, in theory, the limit.”
