Carbon tax isn't sole culprit in recent gas price increase

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Gas prices rose on March 20th in Fort St. John and will get only higher. ( Jordan Prentice, Energeticcity.ca )

FORT ST. JOHN, B.C. — Gas prices have risen in service stations nationwide, and Fort St. John is no exception, but one expert says it isn’t solely due to the carbon price tax increase coming on April 1st.

GasBuddy, an app highlighting fuel amounts nationwide, has prices fluctuating from $1.59 to $1.69 per litre in local stations as of Wednesday, March 20th.

Although some public speculation centres on the carbon tax increase, the president of Canadians for Affordable Energy, Dan McTeague, says this isn’t the only reason for the price hike.

McTeague points to the six-week shutdown of the British Petroleum (BP) refinery in Whiting, Indiana, as a significant contributor.

The refinery resumed normal operations on March 19th, more than six weeks after a power outage, which prompted the energy giant to shut down the complex temporarily and evacuate workers.

“The Whiting plant produces 450,000 barrels of oil daily,” said McTeague. “Almost all of the oil refined is from Canada.”

“Shutting it down drove up the prices on the markets. We are price followers when it comes to energy and most other commodities. Some markets have seen prices go as high as 50 cents a litre since February.”

There was a “bit of a delayed reaction” to those rising prices around town, which McTeague says is because of Fort St. John’s location on the map.

“The rest of the province and even Alberta saw increases weeks ago,” said McTeague.

A tightening of oil supplies surrounding the Organization of Petroleum Exporting Countries (OPEC) and warmer weather play into the scenario.

“OPEC would like prices to return to around 90 dollars per barrel. It’s at 81 or 82 dollars right now, so it means they are having some success,” said McTeague.

“With summer weather coming, and the provincial government’s Renewable & Low Carbon Fuel Requirements Regulation, it will drive gas up 19 or 20 cents a litre.”

McTeague expects a price of about $1.80 a litre in northeast B.C. by the Victoria Day long weekend.

The federal government’s carbon tax increase will be anywhere from 3.3 to 3.5 cents per litre at the pump.

With files from The Canadian Press.