THUNDER BAY – Gas prices are on the way up. The reasons from the oil companies are issues at the refinery level which are reducing supply at a time when demand often increases. Prices are expected to continue to climb over the coming weeks. “The risk of gas prices reaching more than $1.60 per litre in Canada is not insignificant”, according to BMO Economics. Gas prices are up sharply in many areas across the country – climbing as much as 3.6 cents in Ontario to nearly $1.40 per litre, and reaching $1.47 in parts of Quebec – all ahead of the long weekend.
“Although crude oil prices are expected to hover near $100 a barrel in the year ahead, the risk of a near-term spike is elevated due to potential supply disruptions,” said Sal Guatieri, Senior Economist, BMO Capital Markets. “The rising cost of imported overseas oil, together with a shortfall in domestic pipeline capacity, has forced about one-third of U.S. East Coast refineries to halt operations; meanwhile, the Iranian situation could disrupt oil shipments in the Strait of Hormuz, a key route for one-fifth of globally traded oil. This would likely push crude prices back to 2008’s high of $147 a barrel.”
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