Canadians planning a road trip this summer may see some relief at the pump, but volatile energy markets and weather disruptions could pose a threat Gasoline prices Experts say that in the country.
The national average price for regular unleaded gasoline was $1.60 a litre on Wednesday, according to the fuel price tracking website GasBuddy.com and GasWizard.ca.
Patrick De Haan, head of petroleum analysis at GasBuddy, said Canada's average monthly gas prices have been trending down since April but remain relatively high. He said that could deter some Canadians from taking long-distance trips this summer.
DeHaan said gasoline prices typically fall in the summer as refinery maintenance ends and the switch to summer gasoline begins. He said the extra gasoline supply is usually a factor that pushes down gasoline prices every year, and we are experiencing that now.
“As we get into the summer, as we get closer to Canada Day, I think we're probably going to see another 5 to 10 cents a litre drop in gas prices across the country in the coming weeks,” DeHaan told Global News on Wednesday.
If all goes well, DeHaan predicts that the average price of gas in Canada could drop below $1.50 a litre by July 1.
However, he said there could be “surprises” in July and August when hurricanes threaten operations at major U.S. refineries, which could have an impact on costs.
Dan McTeague, president of Canadians for Affordable Energy and a former Liberal MP, said compared with last year, energy prices are roughly the same as they were in 2023, despite a carbon price hike that took effect April 1.
McTeague is less optimistic about Canada's continued decline in gas prices this summer.
Financial News and Insights
Delivered to your email inbox every Saturday.
“I think we should expect the unexpected,” he told Global News, adding, “Gas prices have already dropped significantly.”
Mr McTeague said the price drop could actually boost demand, causing prices to “rapidly recover”.
Volatility in energy markets, tensions in the Middle East and the war in Ukraine are also factors that could put upward pressure on gasoline prices, he said.
Meanwhile, prices for diesel, which is in ample supply at this time of year, are also falling.
“We are seeing diesel prices at their lowest levels since July last year,” DeHaan said.
“In fact, in the coming weeks, diesel prices are likely to fall to their lowest levels since Russia’s invasion of Ukraine.”
Inflation affects travel plans
Concerns about the cost of living are affecting many Canadians' travel plans this summer.
Ipsos recently conducted a poll exclusively for Global News The survey showed that due to inflation, most people (67%) have cut back on their summer vacation plans, an increase of 5 percentage points from last year.
Some 64% of respondents also said economic uncertainty had affected their vacation plans, with three in five saying they prioritized other savings over vacation time.
As other modes of transportation become more expensive, gas at the pumps is paying less.
this The International Air Transport Association warned on Monday that Airfares are likely to continue to rise as the industry faces high jet fuel costs, the aftermath of the pandemic, and global pressure to decarbonize.
Still, DeHaan said he expects more Canadians and Americans to choose to fly rather than drive for vacation this summer.
“Road travel has become more expensive — not just because the average price of gas remains relatively high, but also because the cost of getting around, staying in hotels, eating out has increased, which is costing Canadians more,” he said.
Newest Inflation data from Statistics Canada Canadians paid 7.9 per cent more for gas in April than in the previous month, according to data from Statistics Canada, which cited rising global oil prices, a switch to more expensive summer blends at gas stations and a higher federal carbon tax as reasons for the increase.
— With files from Craig Lord of Global News and The Associated Press.
© 2024 Global News, a division of Corus Entertainment Inc.
