Gas is expected to go up to $1.819 a litre on Sunday, capping a week of “unprecedented” price increases.
“In one week, gas prices will be 23 cents a litre higher than they were last Sunday,” said Dan McTeague, who runs the price tracking site GasWizard.ca and who is the president of Canadians for Affordable Energy.
The predicted increase on the weekend could cause another run on gas, as was seen earlier this week in the GTA, after media reports about a jump in prices sent drivers to the pumps and left some stations with nearly empty tanks.
But there’s no cause for alarm, said McTeague.
“The shortage was just panic buying, or people looking to take advantage,” said McTeague.
“Gas stations might have 50,000 or 60,000 litres. But if you know everybody and their brother suddenly shows up to buy gasoline, it creates a bit of a run on existing supplies.”
Most gas stations have computerized systems that signal when the gas station’s tanks are getting low. And there are a number of storage terminals in the GTA and across the Golden Horseshoe.
The latest price at the pumps are a reflection of a global oil demand brought about by the crisis in Ukraine.
“It’s the risk of not enough supply,” said McTeague. “It’s a very volatile market created by the fact that the world uses 100 million barrels of oil a day, but we can only find 95 million barrels right now,” he says, “a problem that we had well before the invasion.”
In the span of half an hour Friday afternoon, the price of a barrel of oil rose from $112 to $115, said McTeague.
Prices could go much higher if Russia is cut off from exporting its oil. The country is the third largest producer of oil in the world, behind Saudi Arabia and the U.S., and the second largest exporter.
Many countries also depend on Russian exports of natural gas, including Italy and Turkey.
There is no indication that the shortage will affect Canada.
“We are a net exporter of gasoline, so we have plenty to go around,” says McTeague. “There’s no issue there. And we do produce a lot of oil.”
Canada has the capacity to ramp up oil production from 4.2 million barrels a day to 10 million, given the time, says McTeague. But the country lacks the pipeline infrastructure to move oil across the country so that it could be shipped overseas.
“The problem is we can’t get it over there,” says McTeague. “And that’s one of the main reasons why, despite having the third largest reserves and of course, being the fourth largest exporter, our export capacity is limited by pipeline constraints.”
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