The BP refinery outage in Whiting, Ind., is now in the rear-view mirror, and while a return to pre-outage prices has been slower than expected, fuel costs are trending downward across the Prairies.
Patrick DeHaan, head of petroleum analysis at GasBuddy, says relief at the pump should soon follow across Saskatchewan after the late-summer spike.
“With that refinery in northwest Indiana getting back online now, we’ve seen prices sharply reverse, at least in Saskatchewan,” said DeHaan. “Prices are down about three cents a litre from where they were a week ago — the average now about $1.38 a litre.”
In the wake of the Whiting refinery flooding, Moose Jaw saw a rapid surge in fuel prices, with most stations jumping to 146.9 cents per litre. Since then, prices in the city have fallen by seven cents, bringing the local average closer to that of the province and surrounding communities.
“Saskatchewan’s provincial average, as I mentioned, is about $1.38. Alberta (is) a bit lower at $1.29. Manitoba at about $1.36.5, and Ontario at about $1.38,” said DeHaan.
As supply levels normalize and the transition to winter-blend gasoline begins, DeHaan expects prices to continue trending downward.
“We do make the transition back to cheaper winter gasoline here in just five days — that would be next Tuesday,” he said. “With it, generally, we do see downward pressure on prices... Prices should continue to trend lower, if anything, over the next coming months.”
Though it may take a bit longer to reach pre-outage levels, DeHaan suggested sub-$1.30 prices could soon return.
“We could see that here as we get closer to the end of September and October,” he said. “When we do see that seasonal downward trend and the shift back to cheaper gasoline, there’s a strong possibility that we’ll get back below that $1.30-per-litre mark — and we could spend much of the fourth quarter there.”
When asked if any potential disruptions could impact this trend, DeHaan remained cautiously optimistic.
“Not a whole lot of high-level issues right now,” he said. “OPEC over the weekend is raising oil production again for the month of October. That’s certainly good news.”
While fall refinery maintenance may create short-term effects, it is unlikely to have a significant impact on prices.
“Unlike the spring... typically fall maintenance is much more silent of an impact on prices,” said DeHaan. “That has a negligible impact in the fall since supply and demand aspects are improving.”
In the meantime, he recommends motorists take advantage of available tools to find the best deal at the pump.
“I would urge motorists to use apps like GasBuddy to make sure that they are getting the best bang for their buck when they do have to fill their tanks,” said DeHaan.