‘A crimp in supply’: Refinery shut-down causes Sask. gas prices to jump

WATCH: Saskatoon gas prices have jumped up in advance of the long weekend. Here’s what you need to know.

Gas prices in Saskatchewan jumped in recent days, due in part to a supply chain issue stemming from the United States.

“The wholesale price reflected the shutdown of the largest refinery in the U.S Midwest just outside of Indiana, near Chicago, the so-called BP Whiting plant,” explained Dan McTeague, president of Canadians for Affordable Energy.

“It turns out it produces fuel from about 440,000 barrels a day. That makes it the number one by quite a margin. A lot of that does come from Canada, by the way. But the shut down meant, of course, there would be a crimp in supply,”

McTeague says prices jumped up to $0.15/ litre in some locations over just a few days.

Gas Buddy lists the average Saskatoon price at $1.44 per litre, while it’s $1.42 in Regina. Some locations in both cities are charging up to $1.46 per litre.

“Markets responded very dramatically,” said McTeague. “An eight cent wholesale price increase for Saskatchewan, for Alberta, for Manitoba.”

The affordable energy advocate says Saskatchewan is typically known for competitive gas prices compared to the rest of Canada.

“We know in Saskatchewan, gas stations tend to really shave their retail margins to the point where it’s selling gasoline for less than what it costs them to replace it.”

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McTeague explains Saskatchewan gas stations often make up this difference through deals with suppliers and increased sales of other items within gas stations.

“But when you see an eight cent net wholesale price increase, they had to throw the towel in.”

The increase has some Saskatchewan drivers opting to hold off on filling their tanks.

“One thing everyone should be keeping in mind is September 15th, we switch from summer blends of gasoline to winter blends of gasoline,” said McTeague.

“So that should drop prices. Diesel, however, will continue to remain high and potentially go higher.”

The prices are expected to slowly decrease throughout the week, and return to prices those in Saskatchewan are more familiar with soon.