BUSINESS

Major Gas Price Spikes Headed Canada’s Way: Analysts

A potential gas shortage in the eastern U.S. could affect Canada as well.

09/01/2017 09:46 EDT | Updated 09/01/2017 14:40 EDT

Some parts of Canada are heading into the Labour Day long weekend facing serious gas price hikes, with central Canada taking the brunt of it, analysts say.

Hurricane Harvey has disrupted oil refineries along the Gulf Coast, sending gas prices soaring.

Dan McTeague, senior petroleum analyst at GasBuddy.com, predicted in tweets that Greater Toronto, Hamilton, London and the Ottawa area can expect to see a five-cent gas price hike on Friday. He and petroleum analyst Roger McKnight of En-Pro International both predicted that would be followed by another nine-cent hike on Saturday.

That would bring the price of gas around Toronto to $1.329 per litre, which McTeague told CBC News is the highest the region has seen since September 2014.

He also forecast a six-cent spike in gas prices in Vancouver and the Lower Mainland, to $1.459 per litre.

Montreal, where the Gazette reports gas prices have already spiked by 19 cents per litre this week to $1.35, could see a similar nine-cent hike on Saturday, McTeague predicted.

Gas shortages possible


Refinery capacity along the Gulf Coast of Texas and Louisiana is at a seven-year low thanks to Hurricane Harvey, the Houston Chronicle reports. About one-quarter of total refining capacity in the U.S. is offline.

That will affect Canadian gas prices for some time to come, especially if gas shortages begin to materialize.

A key pipeline carrying oil from the gulf coast to the eastern seaboard shut down on Thursday, raising the possibility of gas shortages in the U.S. southeast, mid-Atlantic and northeast, Nasdaq.com reports. Colonial Pipeline Co. hopes to have it reopened by this weekend:

A gas shortage in the U.S. could spill over into Canada, McTeague told Global News.

"If we keep our prices low, that shortage will morph into wholesalers driving north of the border under free trade — and picking up dozens of tankers in gasoline and that will eventually see a run in our own supplies," he said.

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