Diesel prices driving up holiday shipping costs
It's unwelcome news for Canadians as the holidays approach: there's yet another thing driving inflation this year.
The price of diesel is continuing its sharp climb after inventory issues in the summer and autumn, and that'll mean shipping and transport will cost consumers more.
"If the price of diesel is extremely high -- which we are seeing right now -- our cost of living is going to increase even more," Vijay Muralidharan with R Cube Economic Consulting said. "All of the goods and services that we need are transported through trucks, which run on diesel."
It has already started.
Canada Post just increased its domestic parcel surcharge to 37 per cent, up six points from the summer. It cites the rising rate of diesel.
"The cost of shipping generally is continuing to increase and that's a cost that is a huge burden to small business owners," Madame Premier owner Sarah Elder-Chamanara told CTV News. "I have flat (shipping rates for customers and) 99 per cent of the time I end up subsidizing the cost of shipping."
And though it won't -- for now -- in Elder-Chamanara's store, that cost increase is largely bleeding down to consumers.
DIESEL DEMAND
After years of low demand, the commodity is once again a hot ticket item. And with fewer refineries and booming European need, inventory is low and the cost of what diesel is available is heading in one direction.
All the holiday shopping won't help.
"If economic activity is extremely high, diesel demand is extremely high," Muralidharan said. "The one way it might change for the positive is if demand slows, which should eventually happen due to high interest (rates)."
The Bank of Canada's recent rate hikes will lower spending and eventually affect the high prices, but the general consensus is it'll take at least half a year for that to happen.
Muralidharan predicts Alberta could see diesel climb as high as $2.40 a litre later this winter.
CTVNews.ca Top Stories

Amid concern over Canadians going hungry, Conservatives criticized for voting against school food bill
As Conservative Leader Pierre Poilievre continues to voice concern over the increase in food bank usage, his party is being criticized by some for voting against a private member's bill that would advance a framework for a national school food program.
Russian girl shoots several classmates, leaving 1 dead, before killing herself
A Russian girl shot several classmates at school Thursday, killing one person and wounding five others before killing herself, state news agencies and authorities said.
Canada being hit by 3 separate storm systems: Here's where
Winter weather is underway in parts of Canada with three storm systems bringing messy conditions from B.C. to Newfoundland and Labrador.
'The Brick' is at the centre of our galaxy. An unexpected new finding may help unlock its mysteries
A box-shaped cloud of opaque dust that lies at the centre of our galaxy has long perplexed scientists, and observations that reveal a new detail about its composition are deepening the mystery — possibly upending what’s known about how stars form.
Flight safety in Canada is plummeting, a confidential UN agency report finds
A draft report from a United Nations agency gives Canada a C grade on flight safety and oversight, down from an A+ and far below most of its peers.
Basketball star Shai Gilgeous-Alexander wins lawsuit over Burlington mansion previously occupied by 'crypto king'
A judge has ruled in favour of NBA star Shai Gilgeous-Alexander in his lawsuit against a company that sold him a Burlington mansion previously occupied by self-proclaimed ‘crypto king’ Aiden Pleterski.
Canada doubling cost-of-living requirement for international students
Canada will more than double the cost-of-living financial requirement for incoming international students on Jan. 1, Minister of Immigration, Refugees and Citizenship Marc Miller announced today.
Joly condemns Hamas rapes of Israeli women after weeks of pressure
Foreign Affairs Minister Melanie Joly is condemning sexual violence committed by Hamas during its attack on Israel, after weeks of pressure to speak out.
Cindy Woodhouse is the new AFN national chief after David Pratt concedes
Cindy Woodhouse is the new national chief of the Assembly of First Nations.The Manitoba regional chief was tapped to lead the political advocacy organization after her closest challenger, David Pratt, conceded.