Drivers “pretty much coast to coast” can expect a five-cent increase on gasoline per litre come Wednesday, analysts say.
Saudi Arabia is racing to restore production, but analysts say global impacts could broaden as more time passes.
“We’re going to dodge a bullet because of timing,” according to gas analyst Dan McTeague. READ MORE: Crude oil prices surge after Saudi Arabia plant attack Story continues below Typically, Canada transitions from summer- to winter-blend gasoline around Sept. 15. During this time, prices can drop anywhere from three to four cents.
The timing of the switchover, coinciding with the attack on oil supply, will likely help to mitigate a price hike in Canada, McTeague said.Drivers “pretty much coast to coast” should still expect a five-cent increase on gasoline per litre come Wednesday.
If the incident overseas happened a few weeks earlier, that price could’ve been much higher, he said.“For now, we’re in the clear,” he told Global News. “But should it [oil-supply disruption] go on longer. I would expect you’re going to continue to see upward pressure on prices.”
He predicted an increase of three cents per litre Monday morning. By the afternoon, it had jumped slightly, to five cents per litre.Saturday’s drone attack on Saudi Arabia’s energy infrastructure cut off oil production and sent crude prices rising.It interrupted approximately 5.7 million barrels of the kingdom’s crude oil production output per day, which is said to be more than five per cent of the world’s daily supply.
By Monday, oil prices surged more than 10 per cent.WATCH: Drone attacks on Saudi Arabia oil plants may halve crude outputThe Houthi movement, an Iran-backed rebel group in Yemen, claimed responsibility for the attack. U.S. officials, however, have blamed the attacks on Iran.
Iran has denied any involvement, calling U.S. claims “maximum lies.”Roger McKnight, a senior petroleum analyst at En-Pro International, said gas prices in Eastern Canada and those west of Thunder Bay are “linked” to the situation in Saudi Arabia.He had a slightly grimmer estimate for Canadian gas prices come Wednesday, predicting the possibility of a six-cent hike.
“Fortunately, this time of year is what we call the shoulder period of demand, where the gasoline demand is pretty well flat after the driving season,” he said.“But this is really unprecedented because we don’t know how long this is going to be going on.”
McTeague echoed McKnight’s sentiments and said the Saudi situation’s ability to impact the global market should not be discounted.“There really isn’t a lot of spare oil capacity globally,” he said. “It doesn’t really matter how much of production is affected, it’s how long it’s out of commission and how long it will be before normal flows are restored. The world isn’t like it was several years ago where you had everyone producing or selling plenty of oil.”
Saudi Arabia is racing to restore oil production, but it could take weeks before full production capacity resumes.If the situation is prolonged, the impacts could broaden.WATCH: Trudeau says government monitoring fuel prices in Canada after attackThe weekend attack led U.S. President Donald Trump to authorize the release of American strategic reserves, should they be necessary to help stabilize markets.
McKnight said that the strategic petroleum reserve won’t be enough.“He may claim, ‘Well, we’re the largest oil producer in the world, we don’t need Saudi crude. A little message to Mr. Trump — you import seven million barrels a day of crude, a lot of it from Canada, but a lot of it also from Saudi Arabia and the Middle East.”
Trump later asserted that the U.S. is “locked and loaded” to respond to the weekend drone assault.“We may not be so lucky the longer this goes on, especially if there is going to be military action or some kind of escalation of tensions,” warned McTeague.
Diesel prices are already feeling the effects, and if the situation overseas lingers, so, too, could gas prices.“It’s a horrendous effect on diesel,” said McKnight.“The diesel inventories in the states are down a lot so if we get an early winter and we got this crude situation, you can see diesel prices going through the roof, and gasoline prices tend to follow whatever diesel does.”
McTeague is predicting a five- to six-cent increase in diesel prices by Wednesday.He warned that a surge in diesel could have a trickle-down effect over time — including getting food to the table.“It’s likely that it will start to impact jet fuel, all modes of transportation fuel, and that will essentially start to make its way, felt within the next several weeks, at places we’d least want to see it — at the grocery checkout, the cost of home heating, etc.,” said McTeague.
— With files from the Associated Press Read more: Globalnews.ca »
Oil urgently pumped from ship grounded near Mauritius after major spill
The Japanese ship, MV Wakashio, ran aground on a coral reef on July 25, cracked two weeks later and spilled an estimated 1,000 tons of oil into the Indian Ocean.
This is good news for the Canadian Tax Collection Service. charlesadler Alberta should be happy, oil prices will probably rise for awhile. A good war in the Middle East is probably something they will cheer for. KSA oil enslaved you? Too bad Canada closed most of its refineries. We're stuck using world prices for our fuel unlike most exporting countries
I just filled my tank at $1.104 for a total of almost $45. The Mercedes that pulled up beside me, pumped $10.23! These companies find any reason to raise price they are in the buisness of making money that their only purpose. best way to combat is stop driving use public transport or start cycling walking.
Funny the world analysts say different.. Gouging by oil companies assisted Do your research or stop pretending your anything but a mouth piece for big oil 7% loss to the entire planet 4% regained by the north switching to winter blend Price increase negligible Next week expect another price increase due to the changeover to winter gas!
The Saudi attack is going to affect the price of October prices not Wednesday’s. 🙄 We are getting ripped off again 20 for BC Oh the fake attack. Meanwhile we produce it and still have to pay more Well, of course they will raise the prices! Anytime, anyone sneezes, or there is any kind of a disruption SOMEWHERE in the World, they raise the prices! Never mind that the gas in the tanks or in the system is already paid for; RAISE THE PRICES! WE NEED MORE PROFIT! Raise the gas
Why 5¢ ? The Saudi attack is just an excuse that is not justified charlesadler Is that “5 cents” BEFORE or AFTER all the multitude of taxes? 😡😡😡😡😡😡😡 Wouldn't it be nice if we could get our oil from our own country? Oh, wait...🙄 Time to really concentrate on other forms of energy If only someone ACTUALLY built a pipeline in this country.... Oh wait...
Plus another ten-cent increase in November, if liberal_party wins in October and hikes the Carbon Tax as promised? The cathmckenna Electric Car Company is still not happening. I guess that's why she got her boss to buy her a pipeline. All the better to tax you with my dear. So says 🐎 The Carbon Tax Kid. ⛽ cdnpoli ⚡🚗💁😳🍻
charlesadler This driver has put $$$ down on an electric car. Tired of this nonsense. BS all BS so oil prices drop and were told prices at the pump take weeks to respond because they arent completely correlated..oil prices rise, price at the pumps go up immediately..also why are we buying saudi oil when we have so much here at home.
What the drone attack in Saudi Arabia means for gas prices in CanadaA drone strike in Saudi Arabia took out more than five per cent of the global oil production capacity, but analysts say the impact on prices at Canadian gas stations could be minor. Hmmmm... I wonder. rexglacer What the drone attack in Saudi Arabia by an OPEC country will do to 🇨🇦's gas prices now that turdeau has effectively destroyed the energy sector in 🇨🇦. There fixed it for you. TrudeauMustGo
Crude oil prices surge after Saudi Arabia plant attackThe attack Saturday on led to the interruption of an estimated 5.7 million barrels of the kingdom’s crude oil production per day, equivalent to over 5 per cent of the world’s daily supply. Another reason for me to learn more about clean energy Maybe Iran could pick up the slack if we ask nicely. Western Canada shakes it head as Eastern Canada winds up those wind turbines and solar panels. After all the arrogance they have shown towards the west and not wanting our oil but loved the transfer payments. Think of that Oct 21st eastern Canada, you like that foreign oil?
Iran dismisses U.S. allegation it was behind attacks on Saudi Arabia oil sitesThe attacks Saturday claimed by Yemen’s Houthi rebels resulted in “the temporary suspension of production operations” at the Abqaiq processing facility and the Khurais oil field, Riyadh said.
Attacks on Saudi Arabia’s oil plants threaten U.S. gasoline price hikes, particularly in CaliforniaThe recent drone attacks may start a gasoline price hike across North America Good Of course Doug Ford will blame the federal carbon tax.
Second Alberta man told to remove pro-oil and gas shirt during Parliament tourFor the second time this month, a Calgary man was told to remove his “I love Canadian oil and gas” shirt while visiting Ottawa’s Parliament. Pure BS! Some people are allowed to wear headwear that covers their face, but freedom of expression is not allowed on ones’ clothing .... Our laws are weakening ... cmon Canada! TrudeauMustGo
Iran dismisses U.S. allegation it was behind Saudi oil attacks Iran has denied that it was involved in Yemen rebel drone attacks the previous day that hit the world's biggest oil processing facility and an oil field in Saudi Arabia . Iran will own the US when the Democrats get back in power. Biden will forget who Iran is Quit LIEING Iran 🇮🇷 or your days are numbered ! 👇 U.S. pointing fingers again? Wonder whos fingers were up whos arse to point.