As gas prices spike in Nova Scotia and New Brunswick ahead of the long weekend, an industry expert says people should start getting used to paying more at the pumps.
On Friday, the minimum price for regular self-serve gas in the Halifax area jumped by 4.8 cents, to 141.6 cents per litre. The price of diesel has also leapt by seven cents, up to a minimum price of 139.
In New Brunswick, the maximum price of regular self-serve gas went up by 4.2 cents to 145, and the price of diesel rose by 6.5 cents to a maximum price of 152.1.
“Those are prices we haven’t seen in a very, very long time,” said Dan McTeague, the president of Canadians for Affordable Energy.
Just one year ago, people in both provinces were paying less than $1 per litre at the pumps.
These price increases — which are being seen across the country — can be attributed to the rising price of crude oil, which rose from around $72 to around $79 per barrel earlier this week.
“That’s one of the major reasons why we’re seeing these prices respond,” said McTeague.
“Even though it’s a weekly thing, under the regulated system, it just means the Atlantic provinces are simply playing catch-up with the price increases we’ve seen across the country.”
McTeague said Nova Scotia and New Brunswick could face record-breaking prices in the coming weeks as the price per barrel moves toward $80.
“Not only are oil and gasoline and diesel prices going up, we’re also seeing the same for natural gas, we’re seeing the same thing for propane,” he said.
He said while there is “pent-up demand” from COVID-19, the larger problem can be chalked up to supply chain issues.
He said there’s a shortage of fuel, oil and natural gas, which he blames on environmental social governance mandates and a move toward renewable energy.
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“We’re not there yet, and our willingness to push these things means a lot of the capital is being lost and not available to producers to meet this surging demand,” said McTeague.
“There’s just not enough to go around. We have plenty of it but we don’t have the ability to get it to market.”
That, paired with the Canadian dollar’s failure to respond to these increased costs, creates a “perfect storm” in terms of a higher cost of living, he said.
“Energy affordability is a criteria for affordability in general, and we’re starting to see the effects — not just in terms of higher prices for fuel and heating … it’s also coming up now in terms of food costs,” said McTeague. “Costs for just about everything continues to escalate.”
He doesn’t expect to see a gas price drop any time soon.
“I don’t think prices are going to go down,” he said. “Not in the near future, certainly not in the long term.”
Kelsey Lane, the climate policy co-ordinator with the Halifax-based Ecology Action Centre, says the rising price of gas highlights a need to shift from our reliance on fossil fuels.
“Rising gas prices are certainly a concern for many families in Canada, and particularly it signals the volatility in the carbon market,” she said.
Ideally, this would mean more people choosing to use active transportation like walking, cycling or busing, rather than spending more money to drive vehicles.
But as long as cities and infrastructure continue to favour cars, Lane said electric vehicles are a good alternative.
Lane said the number of electric vehicles being purchased in Nova Scotia is increasing each year, and said it’s something more people could consider as gas prices continue to increase.
“If you’re a family trying to plan, knowing that there could be rises in the future and the prices are volatile, that could really influence your thinking around the purchase of your next vehicle,” she said.
While the initial purchase price of an electric vehicle is usually more expensive than their gas-powered counterparts, Lane said not having to purchase as much oil and gas would save people money in the long run.
“It’s really important to try to decrease the initial purchase price of those vehicles, but the reality is that over time, running an electric vehicle is much more affordable for families year over year,” she said.
While there are some existing incentives for purchasing electric vehicles, Lane would like to see provincial and federal governments introduce more to encourage more people to go electric for their next vehicle purchase.