Petroleum expert blames gas price increase on volatility

What’s behind the double-digit increase at gas stations? CTV’s Colton Wiens finds out.

Gas prices in Kitchener averaged around 130.8 cents a litre Tuesday morning, which is about a 13 cent spike from last weeks average of 117.7 cents a litre.

“They dropped, but then they went back up again. Like, what’s the reason for it?” Amanda Anderson, a driver at the Shell station at 4195 King St. E. in Kitchener, told CTV News.

“I don’t really pay too much attention to them, because my car takes premium,” said Anna Fyfe, a driver at the same Shell station. “So anyways, it’s going to be higher than normal. I did really like it when it went down.”

April is often when gas stations switch from winter fuel to a summer blend, which typically raises prices. But an analyst from GasBuddy said the seasonal switchover happened a few weeks ago, and this latest spike is likely due to volatility in the oil market.

“Now with those tariffs paused, oil prices have gone back up from $55 back up to about $65 a barrel,” said Patrick De Haan, head of petroleum analysis at GasBuddy. “I’m thinking that’s where the jump in wholesale gasoline prices also was rather notable. So [as for] the price impact, stations passed along those lower prices relatively quickly. And so when the costs went back up, they also had to raise prices to correspond with that jump.”

De Haan said OPEC production, a potential ceasefire with Russia and Ukraine and nuclear talks between the U.S. and Iran are all headlines that impact the market.

“The wholesale price of gasoline can vary by five to 10 cents a litre in a day on extreme days,” said De Haan. “Today [is] another example of that, the wholesale price of gasoline [is] up four cents a gallon, which would translate to an increase of roughly 13 to 15 cents a litre.”

“As a station owner, you’re buying gasoline every one to three days,” added De Haan. “If you don’t get the timing just perfectly right, you’re going to be paying by later today another 13 cents a litre for filling up. So a lot of that is playing out at the retail pump.”

Throughout the summer De Haan expects prices will continue fluctuating but notes gas in Kitchener is 38 cents a litre cheaper than last year.

De Haan said the paused consumer carbon tax and what the White House does going forward will all factor into the price at the pump.

“Expect to be spending a lot less at the pump this summer compared to last summer,” he said. “But there’s still going to be moments where gas prices may go up ten cents a litre, down ten cents a litre. The volatility is probably going to be much higher than normal this summer.”

One thing drivers can do to save some money is check the prices online before heading to a pump.

“Be an educated consumer and check the price before you pay,” said De Haan.