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Albertans should expect even higher gas prices before May long weekend: analyst

Global News logo Global News 5 days ago Adam Toy
A Calgary gas station shows a recently-increased price of gas on May 13, 2022. © Global News A Calgary gas station shows a recently-increased price of gas on May 13, 2022.

Gas prices in Edmonton and Calgary notched up this week, continuing to put inflationary pressures on Albertans’ pocketbooks.

Many gas pumps across Calgary registered $1.719 per litre on Friday, a few cents more expensive than in the province's capital.

And according to one analyst, prices are likely to continue their rise before the Victoria Day long weekend.

Read more:

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"We're just butting up to the period of time... which we call the unofficial launch of the summer driving season," Dan McTeague of Gas Wizard and Canadians for Affordable Energy said, noting the post-emergency phase of the COVID-19 pandemic has people itching for a return to travel.

The jump at the pumps is because of demand outstripping the supply of gasoline, diesel and oil, he said.

"And at the same time, we've seen an uncharacteristic decrease in the value of the Canadian dollar – it's been very timid. In the face of higher crude prices, Canadians could always count on a dollar that would increase in value versus the U.S. greenback."

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West Texas Intermediate oil prices haven’t been below $90 per barrel since February.

The Canadian dollar has been sliding in value since mid-April.

At an unrelated press conference, Premier Jason Kenney recognized prices at the pump generally follow commodity prices.

He credited gas retailers for apparently passing along the $0.13 per litre savings to customers after the province paused the provincial fuel tax.

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And he said more help could be coming soon to Albertans.

"If our fiscal and economic situation continues to improve as a province, we are considering stepping up with additional measures early this summer to help people with the cost of living," the premier said. "Late spring or early summer would be our horizon."

Kenney also blamed "factors beyond our provincial control" for increased energy costs, naming the federal government’s "very loose monetary policy" which he blamed for driving inflation.

Video: Alberta government tables bill for electricity bill rebates, possible natural gas rebates

McTeague said global energy uncertainty from the war in Ukraine, the U.S. Federal Bank increasing interest rates and speculation of recession have combined to increase wholesale gasoline prices for gas station operators and result in a “pretty skinny” profit margin for them.

"I suspect that if we see another increase of $0.05 a litre on the wholesale side for Sunday, a good, safe bet that (Calgary) could be looking at $1.75 a litre at some point before the May long weekend," he said.

If Albertans cringe at the elevated prices in the province, McTeague said other Canadians are likely looking on "with great envy."

"Come to Toronto, where it's going to be $2.07 on Sunday. It's going to be $2.15 in Montreal. It's going to be $2.22 in Newfoundland. It's going to be $2.31 in Vancouver."

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