With demand for oil at an all-time-high globally, petroleum analysts say B.C. consumers should expect to see some of the highest prices they’ve ever seen at the pump this year.
In GasBuddy’s 2018 forecast report, it says “circumstances beyond Canada’s control,” such as a surging U.S. dollar versus a weaker loonie and the U.S.’s growing exports, will lead to premium prices across the country.
Other major factors include OPEC’s 2016 decision to cut oil production, according to GasBuddy senior petroleum analyst, Dan McTeague.
“That decision curbed excess supply and began soaking up brimming global inventories of crude oil, at the same time boosting oil prices, which was the major reason for OPEC’s decision,” he said in the report.
In B.C., where gas prices vary rather drastically within the province, Vancouver and Victoria are anticipated to see the highest costs of more than $1.38 per litre on average.
That doesn’t include an extra 1.2 to 8.5 cents per litre that will be added effective April 1, when carbon taxes increase to $35 per ton.
READ MORE: No carbon tax relief at the gas pumps
McTeague expects the Canadian average price for gasoline in 2018 to be $1.19 per litre – seeing reprieve in the winter and hitting record numbers in the summer. This will mark the highest yearly average since 2014.
While Vancouver is forecast to see the highest peak prices at $1.52 per litre, Winnipeg and Saskatoon should top out at $1.29. Meanwhile, the highest price forecast for Calgary is $1.33.
“We anticipate that consumers will see gas prices that will be higher than 2017, slightly lower than levels seen in 2014, with a yearly average of $1.19 per litre, the highest since 2014,” the report reads.
With fewer refineries, disruptions shock pump prices
For gasoline, a stable benchmark price for oil is only part of the story, GasBuddy warns.
Seasonal price differences, specifically during the changes in gas formulas from winter-to-summer and then summer-to-winter blends, are just the first of many factors influencing pump prices in both the U.S. and Canada.
Propelled by a stronger economy, and greater exports, demand for petroleum products continued to rise at record-setting levels in 2017, the report suggests, with November seeing the “strongest” consumer gasoline demand ever.
With ongoing demand, mixed with refinery capacity continuing to grow to meet the need, consumers will see shockwaves to the pumps when outages or disruption occur, such as natural disasters or fiscal policies and decisions from central banks.
“Such events are likely to happen again in 2018, creating temporary hotspots regionally.”