Gasoline prices in Canada could rise to about $1.40 a litre in a few months if oil prices stay at current record levels and demand picks up for the summer driving season, oil industry observers say.
Average Canadian gasoline prices were more or less steady at 111.60 cents per litre Wednesday according to the website GasBuddy.com.
But the cost of a barrel of oil surged to more than US$104 on energy markets Wednesday after OPEC said it would keep global production steady for the time being, despite U.S. calls to step it up. Investors who had also expected U.S. oil inventories to rise were also jolted by news that there was, in fact, a decline in crude stockpiles in the key American market.
Vince Lauerman, a global energy analyst with Geopolitics Central, said there is normally a lull in gasoline prices between the winter heating season and the summer driving season. Like many analysts, he said pump prices gould go as high as $1.40 a litre come summer should crude stay at its current levels.
Such a price would likely be a record for unleaded gas in Canada and surpass the $1.30 a litre level hit after the North American refinery shutdowns caused by hurricane Katrina more than two years ago.
Diesel prices are already at record levels, causing headaches across the North American trucking sector as companies pass on the increases to their customers.