The hike in gas prices today is going to get worse.
Prices across the Okanagan Valley averaged around 119.9/litre, but it’s expected to exceed the 125.9/litre very quickly .
“If you see gas at 119 now, I would jump on it because it’s going to go up further today possibly and very likely tomorrow,” said Dan McTeague, a senior petroleum analyst with GasBuddy.com.
“Everyone needs to fasten their seat belts as it’s going to be a rough ride at the gas pumps for awhile.
“I don’t see a downward trend in gas prices for at least the next two weeks.”
McTeague said there are several factors causing the gas price bump—the weak Canadian dollar, a major pipeline that delivers gas from Gulf Coast refineries to the US mid-west currently shut down for maintenance, reduction in the glut of oil on the world market and a booming American economy.
“The American economy is on fire right now. People are working, wages are up and the demand for fuel has shot up,” he said.
“Most of the fuel delivered to the B.C. Interior comes from Edmonton and Edmonton fuel pricing is based on U.S. mid-west gas price futures set in Chicago. And the pipeline disruption is very sensitive to US mid-west pricing, so that’s a key factor behind what’s going on right now.
“We could see a 12 to 13 cent a litre increase in the B.C. Interior before things cool off.”
From a global perspective, McTeague says renewable energy source development is important, but the world appetite for fossil fuels continues to expand.
“The developed world economies are looking for ways to cutback on oil consumption, but the for the developing world countries, which is 90 per cent of the global economy, oil consumption continues to increase,” he said.