As Canadians step into this year, due to economic shift in the global market, the idea of rising gas prices possesses a concern as it is casting a cloud of economic instability for both general consumers and businesses. Gasoline, a lifesaving medicine for transports and a key component of various industries, is expected to increase in cost due to various factors, ranging from environmental regulations to global market situation.
The main idea behind this scheme is to curb the gas prices to help people with their financial issues and economic status. This article will delve into the factors leading to Gas Price Hike Expected in Canada in 2024 and the potential impact for the economy and investments of people.
Note- you can check out the official website of the CRA for the confirmation of the Gas Price Hike in Canada
Gas Price Hike Expected in Canada in 2024
Being a significant producer of gasoline through various regions like Alaska and Alberta, Canada witnessed fluctuating prices for gas in 2023, even getting a 16 percent decrease in the third quarter of 2023. This reduction was due to global slowdown in demand and oversupply of fuel and carbons worldwide.
If the statistics reports from fuel forecast energy trends are to be believed, then gas prices are likely to increase till 2nd quarter of this year due to sudden increase in demand but may fall in the next few years. Gasoline production is somewhere linked to crude oil, and fluctuations in crude oil prices can have a direct impact on costs at power stations. For this quarter, gas prices in Canada are expected to increase by 2.5% which can lead to CAD 1.50/litre.
Overview of Current Gas Prices in Canada
| Name | Increase in gas prices in Canada |
| Country of Origin | Canada |
| Regulating body / Department | Canada Revenue Agency (CRA) |
| Year | 2024 |
| Category | Energy and natural resources |
| Current Price (Canadian Dollar/litre) | 1.44 |
| Expected Price (Canadian Dollar/litre) | 1.50 |
| Reason to increase gas price | Increase in global crude oil prices.
Carbon Tax. |
| Objective | To increase environmental goals.
Less carbon footprint. |
| Affected people/industry | Consumers
Low-income households Transport industry |
Factors leading to increase in Gas Prices in Canada 2024
1. Global Oil Market Dynamics and Currency Exchange Rates:
Canada is one of the net importers of crude oil and the issue of global oil market significantly impact gas prices. Fluctuations between Canadian dollar against U.S. dollar can influence the cost of crude oil. As oil is priced in US dollars globally, so it can increase gas prices in Canada.
2. Environmental Regulations and Supply and Demand Dynamics:
Canada’s commitment to environment conservation, indicated by carbon taxes and cleaner energy regulations, leads to higher gas prices. Additionally, supply and demand dynamics, further influenced by economic recovery and industrial activities leads to the increase.
3. Global Economic Conditions and Production Costs:
The overall health of the global economy influences oil prices, subsequently affecting gas prices in Canada. Economic growth or decline can also impact oil consumption patterns. Meanwhile, production costs due to raw materials availability and refining margins also plays a role in determining the final cost of gasoline.
4. Seasonal Variations, Weather Events, and International Issues:
Variation in seasons such as increased travel during peak seasons, issues in transportation due to unexpected weather events, and geopolitical issues such as the Ukraine-Russia war contribute to the fluctuations in gas prices.
5. Global Political Instability and Transportation Costs:
Political instability in oil-producing regions influenced by fuel prices, infrastructure maintenance, or geopolitical events leads to delay in transportation. It then results in fluctuations in transportation costs from production sites to refineries and distribution points, there by increase in additional expenses.
6. Market Trading and Taxes:
Market trading, especially in the general market, adds another factor to increase in gas price. Speculators investing on future price movements can create a short-term fluctuation in prices.
Taxes, both regional and federal, and further region differences can impact gas prices, leading to variations across different cities in Canada. Additionally, refining and marketing costs contribute to the final price at the pump.
Current Scenario of Gas Price Hike Expected in Canada
The current price stands at CAD 1.44/litre. If the price increases by 2.5%, then it can lead to upto CAD 1.50/litre in the coming days. However, the figures are just based on the trending news and government is yet to announce the prices. Moreover, experts believe that the prices may decrease at the end of 2nd quarter if the global economy becomes somewhat stable.
History Of Gas Prices in Canada So far
| Year | Average Gasoline Price (USD/Liter) |
| 1990 | $0.41 |
| 1991 | $0.44 |
| 1992 | $0.47 |
| 1993 | $0.50 |
| 1994 | $0.54 |
| 1995 | $0.57 |
| 1996 | $0.61 |
| 1997 | $0.64 |
| 1998 | $0.41 |
| 1999 | $0.54 |
| 2000 | $0.67 |
| 2001 | $0.76 |
| 2002 | $0.80 |
| 2003 | $0.85 |
| 2004 | $0.91 |
| 2005 | $1.00 |
| 2006 | $1.05 |
| 2007 | $1.12 |
| 2008 | $1.31 |
| 2009 | $1.02 |
| 2010 | $1.09 |
| 2011 | $1.24 |
| 2012 | $1.27 |
| 2013 | $1.29 |
| 2014 | $1.25 |
| 2015 | $0.99 |
| 2016 | $0.90 |
| 2017 | $1.05 |
| 2018 | $1.20 |
| 2019 | $1.25 |
| 2020 | $1.18 |
| 2021 | $1.38 |
| 2022 | $1.59 |
| 2023 | $1.12 |
How can Higher Gas Prices in Canada Affect Investments?
Inflation: High prices for consumer goods and rare items due to increase in transportation costs.
Consumer Expenses: Consumer may spend fewer on other goods and services, leading to decrease in stock prices for companies involved in travel, retail, and fashion etc.
Bank Polices and Interest Rates: Banks consider inflation and economic growth while adjusting interest rates and can lead to potential rate hikes and their impact on various asset classes.
Energy Sector Investments: Demand renewable energy sources may grow. Sectors like solar, wind, and electric companies can benefit from the shift to renewable energy sources.
Real Estate Market: Areas with good public transportation or nearby to workplaces may become more costlier, impacting real estate values and affecting the Gas Price Hike Expected in Canada in 2024.
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Julie Kanary is an accomplished author and financial analyst with a keen interest in social security, tax, and finance-related topics. With a wealth of experience in the field, Julie has established herself as a reputable voice in the domain of economic policy and financial literacy.Drawing upon her extensive background in economics and finance, Liam contributes regularly & offering insightful perspectives and analysis on a wide range of topics.
we have been therefore with high prices and things at the store were cheaper, it seems that when the prices go down on our gas bills our prices dont go down , but that when the prices go up everything gets whacked over and over again, like its a license to steal, when transportation gets hit its okay toraise the price and then lets forget about lowering the price when the gas prices go down