Gas prices are skyrocketing and some analysts say Canada could be heading for its most expensive summer in ten years in terms of gas costs.
Currently, the average price for regular unleaded gas in Canada is about $1.38 per litre and in Calgary it is almost 10 cents lower, at $1.29.
The rise in price is being blamed on increasing oil prices, the value of the Canadian dollar and the 2010 introduction of the HST.
“If you go back to 2010, the provincial government added 14, 15 cent a litre when it decided to create a HST above the 6%,” said Dan McTeague, an analyst for GasBuddy.com. McTeague added. “As prices go up, they go even higher here in Canada.”
West Texas Intermediate (WTI) climbed above the US$70 per barrel mark last week and some industry analysts say that, combined with the blocking of pipelines and the value of the Canadian dollar, are causing the increase at the pump.
McTeague spoke with CTV Toronto on the weekend and says motorists can expect to pay more this year.
“Even for someone who uses 60 litres a week like I do, you’re looking at an additional $500 to $700 a year more in costs just to get from point A to point B,” said McTeague. “And most people aren’t driving around for kicks and giggles. In fact, they need to get to where they have to go.”
He says it could be the most expensive summer at the pumps in nearly 10 years.
“We're likely into a deficit, in terms of oil production and of oil availability, at a time when the rest of the world is going to increase its demand for oil by 2 million barrels, so there is a serious potential shortage that's coming,” he said.
McTeague explained that the switch from winter to summer fuels will contribute to this, as it costs refiners more to add certain additives to the fuel mix to ensure it doesn’t evaporate under warmer conditions.
Some industry leaders say gas could go up an additional 30 cents in the coming months.
(With files from CTVNews.ca)
