(Calgary) The Canadians who will hit the road for the long weekend of 1er July will find filling up at the pump much less traumatic than this time last year.
The national average gasoline price hit a record high — topping $2.10 a liter — on June 12 last year, as fallout from the Russian invasion of Ukraine disrupted markets energy worlds.
Prices had barely dropped as Canadians geared up for their Canada Day camping trip or cottage visit. On June 28, 2022, the national average gasoline price exceeded $2.05 per litre, according to data from Natural Resources Canada.
This year, heading into the long weekend in early July, pump prices are nearly 22% lower than last year. Price-tracking website GasBuddy.com pegged the national average retail gasoline price at $1.59 a liter on Wednesday. Residents of British Columbia paid the most for their gasoline, while those of Alberta enjoyed the lowest prices.
“Prices have declined since the first half of last year for a variety of reasons, including diminishing (but not alleviating) concerns about supply disruptions from the Russian invasion of Ukraine and slowing global economic growth,” ATB Financial wrote in a newsletter sent Wednesday.
The benchmark price for a barrel of West Texas Intermediate (WTI) crude oil is currently on track to average around US$70 for the month of June, which is close to where prices were a year ago. two years old, before the war in Ukraine.
WTI’s average price for the first six months of 2023 is expected to be around US$75 per barrel, compared to over US$100 per barrel in the same period of 2022, ATB Financial wrote.
Current crude oil prices remain above the five-year average of around US$53 a barrel, but the year-over-year decline has brought some relief to Canadians.
According to TD Economics, lower fuel prices at the pump were the main factor behind the slowdown in annual consumer price inflation to 3.4% in May, its lowest level in the country in nearly two years.
A likely increase throughout the summer
But it’s unclear how long lower gasoline prices may last. Vijay Muralidharan, energy analyst and managing director of R Cube Consulting, said he expects prices to rise through the summer as refiners and suppliers begin to pass on costs related to the new federal standard. on clean fuels, which will come into force on 1er July.
Although refiners have a full year to comply with the new rules, which aim to limit the carbon intensity of fuels sold in Canada, Muralidharan said he believes consumers will feel the effects sooner rather than later.
Although the Clean Fuel Standard is not a consumption tax, it will require companies that produce or import fuel to gradually reduce the emissions intensity of this process by 15% from 2016 levels. here 2030.
Companies can achieve this by blending a higher percentage of ethanol or biofuels into their gasoline, reducing emissions from their refinery through carbon capture and storage or other technology, or by purchasing carbon credits. other companies that have a lower emissions profile.
“It will not be an easy task. And that cost will ultimately be passed on to the consumer,” Mr Muralidharan warned, adding that he believed the impact of the clean fuel standard would offset any lower prices that may come from a potential slowdown in the economy. Mondial economy.
“I think there will be at least, at least (an increase this summer of) three to four cents per litre. Unless something catastrophic happens in the market, we will see an increase in gasoline and diesel prices. »
By the federal government’s own estimates, clean fuel standards regulations will drive gasoline prices up by a maximum of 17 cents per liter in 2030.