High demand for diesel in parts of Europe is fueling a new $3 per-litre threshold in New Brunswick.
New Brunswick’s Energy and Utilities Board invoked its interrupter clause early Saturday morning, sending the price of diesel up 68.6 cents to a maximum of 307.3 cents per litre.
“I got a text Saturday morning with a picture from New Brunswick of the pump price, and I had to do a double take,” says Trevor Bent, CEO of Eassons Transport in Kentville, N.S. “I thought it was a joke at first. It was unexpected.”
All three Maritime provinces saw an increase in diesel prices this past weekend.
“This is certainly a concern for this coming week,” says Bent, who is also the Atlantic Provinces Trucking Association’s board chairman. “We’re a week behind in our fuel surcharge. We pay the price this week and then we don’t collect until next week. So if there’s an increase we don’t actually see an increase in our program until the following week. That lag in and of itself from a cash flow perspective is one thing that can hurt and we feel that.”
Supply issues and market volatility are expected to continue throughout the winter months, according to Patrick De Haan, the head of petroleum analysis at GasBuddy.com.
“The only good news is maybe months away and that is there’s additional refining capacity coming online in the next year,” says De Haan. “But a lot of that is overseas and Canada has had a very tough policy on producing oil and refining it.”
De Haan says diesel price pressures in the Maritimes and the U.S. New England states are being exacerbated by Russia’s invasion of Ukraine.
“Russia produces a lot of heavy oil,” says De Haan. “Europe has been trying to rid itself of that Russian oil and products like diesel. So there has been incredible demand from Europe to get supply of diesel from the other side of the pond.”
“Increasingly, Europe has been trying to pull away diesel products from Canada and the northeastern United States. And that has put an incredible constraint on supply, pushing prices through the roof.”
