Toronto gas prices set to climb higher Wednesday: analyst

A person pumps gas at a gas station in Mississauga, Ont., Tuesday, February 13, 2024. THE CANADIAN PRESS/Christopher Katsarov

Gas prices in Toronto are expected to rise again Wednesday morning as the Middle East conflict rages on, and one energy analyst says there may be no limit on how much higher they could climb.

“There is really no end in sight,” En-Pro International chief petroleum analyst Roger McKnight told CP24 on Tuesday. “Because it depends on how far this mess actually spreads and who gets involved.”

McKnight said gas prices will increase by two cents overnight to $1.56/l — which marks a 22-cent jump since the United States began its military action in Iran on Feb. 28.

The military operation has expanded and Iran has effectively closed the Strait of Hormuz, a sea passage between the Persian Gulf and the Gulf of Oman, which roughly one fifth of the world’s oil supply passes through.

Oil prices have increased since the war began and spiked to roughly US$118 a barrel on Monday, before dropping to $84 per barrel on Tuesday.

Energy ministers from the G7 are expected to discuss soaring global energy prices on a call on Tuesday. A day earlier, the intergovernmental group’s finance ministers stopped short of committing to coordinated emergency releases of reserves.

McKnight said even if the G7 had agreed to release its reserves, the group would be “dreaming” to think that would help bring down oil prices.

“The G7 are going to get together and see what they can do about that. But I think that’s political theater, because you’re not never going to be able to get that product overnight to solve this problem,” he said.

There are reports from some other energy analysts that gas prices in Toronto could top $2/l, however McKnight said that any long-term call on pump prices amid the developing Middle East conflict would be hard to predict.

With files from The Associated Press