‘Enjoy it while you can’: Toronto gas prices low now but headed for increase
Posted August 24, 2022 5:22 pm.
Last Updated August 24, 2022 5:34 pm.
Gas prices in Toronto and across most of the GTA have dropped and have been steady compared to last month, but the good times won’t stick around for long.
Roger McKnight, Chief Petroleum Analyst at En-Pro International, tells CityNews that the price of gas is expected to drop a cent on Thursday to $1.589/litre at most GTA stations. That would be the lowest gas has been this month after being as high as $1.749/litre at the start of August.
McKnight says the demand for gas is lower now than it was before and notes that an increase in prices should kick in once cooler weather arrives in southern Ontario — likely in September and through October.
“What happens in the fall, it’s diesel prices that determine gasoline prices,” McKnight says. “If diesel goes up, it drags up gasoline prices. Those inventory levels in the U.S. are very bad. If we have an early cold snap, you’ll watch diesel prices skyrocket along with heating oil.”
“I would enjoy these price falls for gasoline while you can because it isn’t going to last,” McKnight cautions. “I think $1.90 is a little bit high. I think we’ll be in the $1.80 to $1.85 range, which would be the comfort level.”
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One local driver tells CityNews he’s unsure if prices will ever drop to what they used to be.
“[I am] not travelling as much. I go up north a bunch of times, usually in the summer,” he said. “Now I am backing off on that. [The prices] are affecting everything I do.”
Canadian gas prices spiked over 30% in July
Oil prices began rising in mid-2020 as economies recovered from the initial shock of the pandemic. They rose again when the U.S. and allies announced sanctions against Russian oil over Russia’s war against Ukraine.
“That is going to encourage diesel and gasoline exports to Europe to make up for that shortfall,” McKnight says.
“Because the European sanctions will come into full effect, theoretically by the end of the year. Grab this while you can because I don’t think it will last.”
In Canada, although gas prices rose 35.6 per cent in July compared to a year earlier, that was down from a whopping 54.6 per cent increase in June. Still, Canadians are feeling the pinch from inflation as food costs were up 9.9 per cent compared with a year ago, the fastest pace since August 1981.
The high monthly gas price in July across Toronto stations was 193.9 cents a litre, reaching as high as 214.3 cents a litre in June.
Statistics Canada said the downward pressure on prices at the pump was due to a combination of factors, including ongoing concerns related to a slowing global economy, increased COVID-19-related public health restrictions in China and slowing demand for gasoline in the United States.
The year-over-year inflation rate slowed to 7.6 per cent in July, with the deceleration largely driven by a decline in gas prices even as prices for food, rent and travel continued to rise.
With files from Mark Douglas of CityNews 680
