Despite the fact that gas prices in the GTA have risen by a stunning 25 cents per litre in the last week, one industry analyst warns that this could be the “quiet before the storm” due to continued geopolitical concerns in Eastern Europe.
Since last Monday, the average price of a litre of gasoline in the GTA has climbed from $1.58.9 to $184.9.
However, Dan McTeague, president of Canadians for Affordable Energy, tells CP24 that people should expect more pain at the pump as the fallout from Russia’s invasion of Ukraine continues to drive up the price of Brent crude.
In fact, McTeaque says that he expects oil to approach US $150 a barrel within weeks, causing the cost of gasoline to surpass $2 a litre.
The cost of a barrel of oil was at $95 as recently as late February by jumped above $120 overnight on fears that the US would cut off oil imports from Russia, which accounts for about five per cent of the country’s supply.
“This is really just the calm before the storm because I think we’re heading to $150 per barrel of oil and that would mean gasoline prices would easily surge to $2 a litre probably in the next few weeks unless matters should change dramatically between Russia and Ukraine,” McTeaque said.
McTeaque told CP24 that he initially thought gas prices wouldn’t hit $1.90 a litre until a week or two from now but he now expects that threshold to be reached as soon as this week, beginning with an anticipated three cent hike on Wednesday that will push the price at the pumps to an average of $1.88 a litre.
He says that a planned increase of the carbon tax from eight to 11 cents per litre as of April 1 could also further inflate costs.
A number of officials, including Brampton Mayor Patrick Brown, are calling on the feds to hold off on that tax increase.
“I recommend three weeks ago today to the finance committee in budget consultations that it would be a good idea at least to hold off on that,” McTeaque said. “At the same time federal and provincial governments should be sitting down and ‘hang on here.’ Gasoline across the country was about a$1.24 a litre this time last year, that additional 60 cents is now being taxed at 13 per cent. Maybe they should be rebaiting some of that GST, especially to people who are having a tough time and a tough go of it. This is going to cascade as we know into other areas of the economy, most notably for those of us who don’t drive into food and other areas of pricing. It’s inevitable and I think the governments have no choice, they’ve got to find ways to slow that down.”