If you’ve filled up your gas tank recently, you may have noticed your bill was higher than usual.
Experts say this is due to a number of reasons, including oil reaching a new high of nearly $80 a barrel.
Patrick DeHaan, head of petroleum analysis at GasBuddy said some gas prices are as high as a $1.40 per litre.
One gas station in Regina was charging $1.43 a litre on Wednesday.
There is also a shortage of natural gas in Europe and disruption in oil production in the Gulf of Mexico due to Hurricane Ida.
“I think it’s because of these worsening supply chain problems that we’ve been seeing that oil prices are probably not going to go down significantly for quite some time,” DeHaan told Global News.
“So I’m afraid that what we’re seeing today with $1.40 a litre prices may stick around for a month or two and potentially we may not see relief for several months, if even that,” DeHaan told Global News.
DeHaan added that these prices are some of the highest we’ve seen since 2008.
Dan McTeague, president of Canadians for Affordable Energy, said people should “get used” to the steep prices.
McTeague has been collecting his own data of energy prices since 1996 when he was a Liberal MP.
He says the price of natural gas in North American markets have tripled.
“Last September they were a 1.92 per MMBtu (British Thermal Unit). This September it was 5.16 MMBtu,” McTeague told Global News.
“Those prices are starting to be passed on to customers in British Columbia, Alberta (and) Ontario, and they’re likely to be met with what could effectively be by winter is the doubling of home heating costs.”
McTeague said propane isn’t far behind, either, and is now selling at a very significant premium compared to last year.
“As we’re heading into colder months, fall heading intro winter, it’s not just the cost of gasoline, diesel, and heating oil. It’s also now the costs of the other fuels that give us more and drive our economies.”
McTeague added that natural gas is also used to process “everything from plastics to high value added goods.”
“I think we have to sort of understand what’s happening here and that is demand is surging for all these products, and it’s post-recovery pent-up demand, that’s meeting a lack of supply and a part of that. In fact, a good part of that is the result of new policy, a practice now that has been well-developed in Canada, now the United States and around the world of disinvesting in hydrocarbons in oil and natural gas.
“The result is predictable: less supply, more demand equals higher prices, and the sky is the limit.”
McTeague thinks the federal government has acted too quickly in adding carbon taxes on all fuels.
“We’ve just compounded the problem, and somebody’s going to have to throw in the towel or consumers are going to have to throw in their wallets, empty as they will be.”
McTeague said there will be “little bit of a dip” in prices starting tomorrow, which is not related to the Thanksgiving long weekend.
He added this is about as good as it will get.
“We are going to be heading towards all-time records in this province, and that’s not really a matter of if but a matter of when.”
It’s also important to consider the Canadian dollar, McTeague said.
“The Canadian dollar is still trading at 126 pennies to buy 1 US dollar. So a weaker Canadian dollar caused by our inability to export more of what we’ve done in the past means we no longer get that shield. In other words, last time we had nearly $90 oil back in the early 2000s, 2008 and 2014, the Canadian dollar was relatively within 10 cents on par.”
“That alone costs us an extra 14, 15 cents a litre, and that’s just gasoline. Imagine what it’s doing to food, what it’s doing to ever other commodity.”
“It’s a hidden tax that people do not see,” he said.
McTeague added that these high prices will continue for the next year and a half.