Canadian gas prices could jump by over 9 cents per litre, thanks to Hurricane Harvey


hurricane-harvey

Thu, Aug 31: After the arrival of Hurricane Harvey in Texas, Canadian motorists are about to pay significantly higher prices for gasoline and other fuel. As Sean O’Shea reports, it boils down to less refinery capacity and little competition.

Gas prices across the country are going up thanks to flooding from Hurricane Harvey, with some places set to see a jump of over nine cents per litre.

The storm, which hit Texas last Friday, has disrupted oil refineries and pipelines on the Gulf Coast, leading to higher prices in the United States – and that has bled over into Canadian pricing.

Some of the biggest pipelines in the United States, supplying the northeast market and the Chicago area, have already shut down or reduced operations because they have no fuel to pump.

Wholesale gasoline and jet fuel prices have soared as at least 4.4 million barrels per day of refining capacity, or nearly 24 percent of total U.S. capacity, has been closed due to the record rains.

For comparison – Canada produces around 2 million barrels per day to meet its own needs, Dan McTeague, senior petroleum analyst with GasBuddy.com, said.

How it will affect Canadians, depends on where you live, McTeague explained. Toronto and Montreal could see a jump of nine cents a litre by Saturday.

“Ontario will get the brunt of it, as will Quebec, ultimately, by Wednesday next week,” McTeague explained.

“Really it’s further you go, the less impact there is the storm.”

He said gas retailers usually have a buffer, which is why there was a delay in the jump of prices, but by Tuesday, there will be some significant increases.

McTeague offered a look at what the country could expect in the coming week.

Atlantic Canada can also expect a jump of about 5-6 cents or more per litre, Fred Bergman, a senior policy analyst with the Atlantic Province Economic Council, told Global News earlier this week.

Anywhere west of Thunder Bay won’t see too big of an increase, because the pricing isn’t coming from the New York Harbor region, which is up 29 cents per gallon.

A woman fills up gas at a Toronto station on Aug. 31, days before a major gas prices hike is expected.

A woman fills up gas at a Toronto station on Aug. 31, days before a major gas prices hike is expected.

Doug Ives/CP

Prices at the pump have hit a high for the year for the United States.

“Everything from Maine all the way down to Florida, those states are most heavily affected,” McTeague said.

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