A noticeable price difference for fuel across southern Alberta has drivers frustrated and confused Wednesday.
“I knew they were going to go up with the carbon tax but I just have to buy gas anyways,” one driver in Lethbridge said.
Senior Petroleum Analyst at GasBuddy, Dan McTeague, said the tax that came into effect January 1 is only part of the increase. The levy adds just under five cents per litre.
READ MORE: Drivers line up for gas ahead of Alberta’s looming carbon tax
A bigger factor in the increase in Alberta was supply disruptions in the mid-west United States.
McTeague said two refineries are having trouble making gasoline thus, raising the prices.
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“Those two refineries being out causes about a 30-cent-a-gallon jump on the markets. It doesn’t mean that Americans paid for that but it does mean that in Canada, we are price takers – despite all the oil we have and we follow the U.S. market pretty much to a ‘T,'” McTeague said.
“Multiply that by a weak Canadian dollar and that’s why you saw increases in the order of 10 cents a litre.”
Across the city, most gas stations were hovering at around 113.9 Wednesday, with wholesale retailers like Costco sitting a bit lower at 106.4.
Big box stores are able to keep lower prices because other retail items like windshield wipers and groceries can help cover their operating costs, according to McTeague. But, small retailers don’t have that luxury.
“Small independent retailers don’t have much protection. They have to drive their prices, which is often their operating costs, and that’s what actually went back up,” McTeague said. “At the same time that we saw wholesale costs going up, they also restored their 10 per cent retail margins.”
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Motorists are hoping relief comes soon. McTeague adds that relief could be days or weeks away.
“I think it’s going to stay the same for the time being, except for retail margins that tend to drop,” McTeague said. “Generally speaking, I think your going to see prices drop a tiny bit.”
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