Gas prices are expected to drop quickly as the federal consumer carbon tax is coming off across the country. In Saskatchewan, that's being joined by the industrial carbon tax drop, which may also have an effect on other consumer goods.
Patrick Dehaan, Petroleum Analyst with GasBuddy, talks about what we could see with the upcoming prices.
"Actually, looking provincially, Saskatchewan's down to about 149 a liter. That's down 5.2 cents from yesterday's average of 154.2. The Canadian National average is down 5.5 cents so far, and keep in mind these are averages. They recompute every few moments as we get new data, so a 5.5 centimeter drop corresponds to a pretty big drop in what people are reporting to us."
In total, the reports are showing drops of around 10-15 cents a liter, with any stations that haven't lowered yet expected to do so soon.
As the tax is a line item rather than a tax on the fuel itself, most stations will be able to simply stop collecting the tax to make that change quickly, with DeHaan saying the only limiting factor is a station's computer system.
"Taxes are something that don't generally change very frequently. So, depending on the station's technology, they may have been able to program this in advance and some others not, but thankfully, this was at the retail level, so very quickly this can be implemented literally within moments of the pause becoming effective."
Gas prices are still expected to rise soon as the switch happens from winter to summer gas, with DeHaan saying there may be an increase in prices in the next 24-48 hours due to seasonal factors.
That, combined with oil prices rising on their own currently, may mean the carbon tax coming off is not the relief people want it to be.
"We're still contending with refinery maintenance, rising demand as temperatures are warming up, and the transition to summer gasoline is almost over. So we shouldn't go back up much. But those seasonal trends may persist."
DeHaan says that another big factor for gas prices is tariffs, with those potentially hitting energy exports and causing a recession in both countries.
"If we do see a significant tariff that's really going to cause potentially a slowdown or recession in both the US and Canada, I tend to believe that prices will probably be in the mid-dollar a liter range. We'll have between $1.35 to $1.50 a liter here for most of the summer."
DeHaan says there's still a lot of uncertainty, including refinery outages, potential tariffs, or potential OPEC policy, that make it difficult to predict the upcoming months.
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