Advertisement

Canadians could pay over $1,000 for gas this summer

Click to play video '3 ways to save money amid rising gas prices' 3 ways to save money amid rising gas prices
Do you think gas prices have risen over the years? According to GasBuddy analyst Dan McTeague, 2018 is expected to be the most expensive year for gas thus far – May 4, 2018

Gas prices in Canada are approaching record highs and could remain there through much for the summer.

With oil prices climbing, drivers from coast to coast are likely in for the priciest driving season in four years, according to analysts.

The national average gas price is currently hovering around $1.34 a litre, up from around $1.09 a litre this time last year, said Dan McTeague, senior petroleum analyst at GasBuddy. And there are few signs that the pain at the pump will ease off as the spring turns into summer.

WATCH: Canadian Taxpayers Federation calls for feds to eliminate gas tax

Click to play video 'Canadian Taxpayers Federation calls for feds to eliminate gas tax' Canadian Taxpayers Federation calls for feds to eliminate gas tax
Canadian Taxpayers Federation calls for feds to eliminate gas tax – May 17, 2018

READ MORE: Gas prices pinching your wallet? Here’s how much you could save with an electric car

Gas prices in Canada jump by between five and seven cents a litre on average at the end of May. It’s unclear whether the same will happen this year, given that prices are already 25 cents a litre above last year’s levels.

Story continues below advertisement
“There’s still pretty good odds that prices will head up [further],” with prices possibly reaching $1.40 at times through the summer, McTeague told Global News.

For Canadian motorists, this means spending potentially hundreds of dollars more at the pump or revising travel plans to stay closer to home.

READ MORE: Gas prices are rising, your commute is still the same. Here’s how to save money

According to calculations by Global News, a driver logging 6,500 km this summer would spend $113 more in the average compact car, $186 more in a typical SUV and nearly $200 more at the wheel of a gas-fuelled pickup truck.

WATCH: Gas tax critics say car-dependent Canadians in rural areas have no options other than driving

Click to play video 'Gas-dependent Canadians in rural areas have no options other than driving: Taxpayer activists' Gas-dependent Canadians in rural areas have no options other than driving: Taxpayer activists
Gas-dependent Canadians in rural areas have no options other than driving: Taxpayer activists – May 17, 2018

Drivers of SUVs and pickup trucks, in particular, could easily spend around $1,000 in gas this summer, the numbers show.

Story continues below advertisement

Soaring crude prices are driving up gasoline prices across North America.

Brent crude, the world benchmark for oil prices, briefly touched US$79 a barrel on Tuesday, the highest since November 2014 and up from just over US$50 a barrel this time last year. The North American benchmark, West Texas Intermediate (WTI), meanwhile, is trading at US$71 a barrel, up from less than US$50 a year ago.

WATCH: Andrew Scheer grills Justin Trudeau on gas prices in B.C.

Click to play video 'Andrew Scheer grills Justin Trudeau on gas prices in B.C.' Andrew Scheer grills Justin Trudeau on gas prices in B.C.
Andrew Scheer grills Justin Trudeau on gas prices in B.C – May 9, 2018

Experts point to several reasons for the hike. Saudi Arabia, the leader of the Organization of the Petroleum Exporting Countries (OPEC), for example, is aiming for a price of US$80 a barrel in order to finance a slew of ambitious — and expensive — social policies. And, generally speaking, OPEC has shelved the idea of flooding global markets with oil in an attempt to drive U.S. shale oil producers out of business.

Story continues below advertisement

U.S. President Donald Trump’s decision to reimpose sanctions on Iran is widely expected to give prices another boost by taking 800,000 barrels of Iranian oil off the market.

READ MORE: 3 numbers you should check before deciding whether to lease or buy a car

And, in Canada, it doesn’t help that high crude prices aren’t lifting the loonie as much as they used to. Although the Canadian dollar has regained a bit of ground in recent weeks, it isn’t getting as much of a boost as it once did from good news in the energy markets, according to McTeague. Because oil is traded in U.S. dollars, a weaker exchange rate means Canadians pay more at the pump.