The cost of gas in Greater Victoria spiked Tuesday, with some stations around the region reporting prices as high as 154.9 cents per litre.
According to GasBuddy, gas prices in Greater Victoria have hit their highest levels in a decade. The previous record was in summer of 2008 when prices went to $1.536 or 153.6 cents per litre.
“We’ve never seen this kind of a price before,” GasBuddy.com‘s senior petroleum analyst Dan McTeague said.
Before Tuesday, prices were around 144.4 cents per litre or 145.9 cents per litre, depending on the station.
The sharp increase is not unexpected. Drivers on Vancouver Island and the Lower Mainland have been seeing near-record prices this winter and spring due to a chronic supply shortage.
There are other reasons why drivers in Greater Victoria are paying more this month. On April 1, Greater Victoria drivers saw a two per cent per litre tax increase to fund transit improvements. It brought the total gas tax to five cents per litre and is expected to raise about $7 million per year.
British Columbia’s carbon tax rate also went up by $5 on April 1. It is now $35 a tonne, which meant an increase of about 1.2 cents per litre to the price of gas and diesel.
“What you had was two things happen at the same time,” McTeague says.
“Without that tax, you definitely wouldn’t have broken the record.”
In B.C. some experts are also predicting gas prices will surge beyond $2 a litre and there will limited supplies if there is a sudden loss of oil export from Alberta. The Alberta government says it intends to limit exports if B.C. continues to block Kinder Morgan’s Trans Mountain pipeline expansion.
And while Greater Victoria drivers may be paying some of the highest prices in the country, gas prices are also soaring elsewhere. This is due to the chemical composition of gas being different in the summer than the winter. U.S. refineries are now free to sell their product to anyone so refining margins have increased. Crude prices are also rose to their highest level since 2014.
McTeague said the summer driving season will also lead to a four to six cents per litre increase.
Oil is also priced in U.S. dollars. And since the Canadian dollar has been the worst performing major currency against the U.S. this year, it means drivers across Canada are seeing a bigger dent in their wallets.
However, McTeague said drivers in Greater Victoria may want to wait until next week to go back to the pump.
“The retailers tend to shed their 10/12 cent retail margin. That’s their operating cost. They sometimes shed them in half so you could very well be back to 149.9 by Tuesday or Wednesday of next week but you won’t fall much below that.”
With files from the CBC