Experts predict the cost of gasoline in Saskatchewan is about to rise, as war in the Ukraine and a tight global supply places pressure on the market in Canada and worldwide.
On Wednesday, gasoline prices were the lowest on the prairies and in the Maritimes, typically $1.47 a litre compared to $1.50 in Alberta and $1.61 in Manitoba. Ontario prices are $1.67, Quebec and Newfoundland $1.80 and $1.94 was reported on the B.C. coast for regular unleaded.
“Saskatchewan is now the cheapest province in which to buy fuel in Canada,” said Dan McTeague president of Canadians for Affordable Energy, Wednesday afternoon.
Service stations in Saskatchewan aren’t making money at current prices so a significant increase is anticipated soon. In fact it could already be seen at some service stations early Wednesday evening, with $1.58 reported at some spots.
“Gas stations probably won’t simply raise prices just five or six cents per litre. They may very well raise it as much as 10 or 11 cents in one full swoop to get back some of the money that they are losing,“ McTeague said.
Oil prices have surged beyond $110.00 a barrel. The province said high oil prices will have a positive impact on Saskatchewan’s oil royalty revenues, in an emailed statement.
“A US$1 per barrel change in the fiscal-year average WTI oil price results in an estimated $14 million change in 2021-22 oil royalties (all else being equal),” the province said in the statement. “It is expected that global oil prices will remain elevated, for a range of geopolitical reasons, for some time.”
Oil prices remaining high could encourage new drilling investment in Saskatchewan. Additionally, the government said high potash prices driven by market growth, crop prices and supply will also benefit the province.
“Strong potash prices and high sale levels are having a positive impact on investment, employment, and the overall impact on provincial potash revenues,” the province said in the statement.
Potash prices are at their highest levels in more than a decade, with prices expected to remain elevated due to the current geopolitical situations in Belarus and Russia, the province added.
However, farmers could pay the biggest price as the cost of diesel goes through the roof and inputs like fertilizer and chemicals double and triple in price.
“All of our inputs are going to be higher this year so we are going to have to really watch our application, watch how we do it and make sure we do it right so we save our money where we can,” said newly elected APAS president Ian Boxall.
The higher cost of producing food and transporting it to market will result in consumers paying more at supermarkets. Many experts predict grocery bills will increase by as much as 30 per cent this year.
