Gas Prices Hit RECORD High Across Canada

As of today, gas prices are hitting above $2 a litre or otherwise getting close to that benchmark.

According to Gas Wizard, a site that tracks gas prices across Canada, prices have jumped by four to six cents in many urban centres across the country. In Vancouver, the price of regular gasoline reached $2.17.

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"The average in Canada is going to get a lot closer to that $2-a-litre psychological barrier, if you will. And it's not likely to end there any time soon," Dan McTeague, president of Canadians for Affordable Energy, said.

Gas prices have risen rapidly over the last year, with the Russian invasion of Ukraine exacerbating the trend. Last May, the average gas price in Canada was $1.32.

Vijay Muralidharan, director of consulting at energy analytics firm Kalibrate in Calgary, said it's not a new phenomenon.

With the start of "driving season," prices were expected to jump as they historically do between the months of April and September, he said.

Another factor driving gas prices, according to Muralidharan, is the global shortage of diesel, which has pushed up prices significantly. Given that gasoline and diesel are both produced from crude oil, the price of one naturally drives the price of the other.

"To produce more gasoline, the margin of gasoline should match diesel," said Muralidharan.

Diesel prices are well above $2 in most parts of the country. In St. John's, the price of diesel sits at $2.73.

Muralidharan expects prices to stay strong for the next couple of months. High prices for longer than that will lead to "demand destruction," he says, where people start decreasing their demand for fuel.

"If it stays there at high levels for a month, two months or three months, you will see people making tough choices and that will impact your demand and prices will have to respond," he said.