Gas prices jumped early this week to 145.9 cents per litre.
This recent spike in gas prices in Manitoba — and across parts of Western Canada — is largely due to an unexpected shutdown at the British Petroleum (BP) Refinery in Whiting, Indiana.
Flooding in Indiana
Due to severe thunderstorms and flooding, parts of the BP facility were forced to shut down on Monday evening.
Although the facility had a recovery plan already in place, the inspection and restart process is meticulous and time-consuming to ensure safety.
Matt McClain, petroleum analyst at GasBuddy, says the Whiting Refinery is a key supplier for Alberta, Saskatchewan, Manitoba, and several U.S. states.
“When a flooding issue or any natural disaster hits a refinery, every component of those massive facilities has to be inspected,” McClain explains.
“Once they give the ‘all clear’ that everything is good, then they’ll be able to restart that refinery and get things back to normal.”
Interlinked issues
McClain notes that Canada and the U.S. are highly interdependent when it comes to petroleum supply, meaning disruptions in American refineries can quickly ripple into Canadian markets.
“Anytime there is some type of refinery issue, it doesn’t matter which side of the border it happens,” he says.
“Canada and the US are interlinked a lot when it comes to petroleum products.”
Prices to drop
McClain says folks should start to see a slow drop in prices as early as next week.
“Hopefully, by Labour Day weekend, we will start seeing some prices drop slowly. "We’re talking one to three cents per liter max,” McClain notes.
“But that’s still up in the air, depending on what the inspectors find.”
McClain encourages drivers to use the GasBuddy app to find the cheapest fuel nearby.
“If you ask (the app) to find the cheapest gas point on your journey, that's going to help you out a little bit and help you save, you know, possibly 5 or more cents per liter.”
McClain notes that despite this recent price hike, the cost of gas remains comparatively lower than last year. In 2024, gas prices in late August were around 152.9 cents per litre.