This is why gas prices are expected to be the highest they've been since 2014
Cillian O'Brien, CTVNews.ca Staff
Published Friday, December 28, 2018 11:11AM EST
Last Updated Saturday, December 29, 2018 10:01AM EST
Next year could see the highest gas prices in Canada since 2014 because of carbon taxes, according to an analyst.
Current low prices, caused by a glut in supply in recent months are set to rebound sharply in 2019, Dan McTeague, senior petroleum analyst at Gasbuddy.com, told CTV News Channel.
But we still have a week or two before things get really "strange", McTeague said from Oakville, Ont.
“You’re going to see 2019, because of carbon taxes, be much more expensive than even 2018, which puts us at the highest prices for energy going back to 2014,” he said.
“There’s always the possibility that retail gas stations will raise their retail margins. They often compress those -- it’s one of the reasons we’re seeing such low prices right across the country.
“Even Vancouver will see a seven cent a litre decrease tomorrow.”
As oil-producing countries tackle their oversupply of oil, the overhang will start to be whittled away come January, McTeague explained.
“Not just OPEC , but here in Canada as well, with the curtailment of 325,000 barrels by the Alberta government,” he said.
Extreme volatility will come to characterize 2019, he believes.
“You’re going to see low prices like you see now, you’re also going to see significantly higher prices, especially as we head towards April when governments help themselves to a much higher price.”
McTeague said gas prices are about 16 cents a litre less than this time last year.
“The only thing that’s holding that back right now is the weaker Canadian dollar because we price all our commodities in U.S. terms,” he said.
“This is probably as good as it gets, with government pulling back on carbon taxes until April 1, take advantage of this while you can.”