Pump prices hit new record high in Metro Vancouver

We knew it was coming, but that doesn’t lessen the sting, as the price of gas hit a new record high for Metro Vancouver Thursday morning.

Many stations across the region jumped up to $2.399 for a litre of regular overnight. That is three cents more than the old $2.369 record set in June.

So, where do we go from here, and how much higher can the price at the pump go?

Predictions from analysts vary widely, from a jump to $2.50 to a drop to below $2 per litre in the weeks ahead.

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Paul Pasco, principal consultant at Calgary-based Kalibrate, is among those who believe drivers may soon see a bit of relief.

“If all goes according to plan you should dip back just below $2 probably just after Thanksgiving. And my guess is we will see a rise just after Christmas, that is how long it will take for the recession gloom to ease and the supply realities of crude to hit the markets.”

Much has been reported about the pressures on wholesale gas prices, a lot of it to do with refinery capacity along the West Coast and various issues that have affected that, including planned outages.

Hurricane Ian is also impacting East Coast production, with ripple effects across North America. Pasco suggests an overall lack of investment in new refining capacity means the system is unable to handle disruptions well.

“Over the last two or three years, the loss of refining capacity has not impacted the ability to supply the market when everything is working. What it has removed is the wiggle room in the market, so a refinery going down can no longer be absorbed by spare capacity in the market. And right now we have had two refineries taken out or damaged by fires in the US Midwest, so backup plans are in short supply.”

As for West Coast capacity, Pasco says the Phillips 66 Ferndale Refinery in Washington state, which has been down for planned maintenance, should be back up and running in October.

Pasco predicts we will see some stability in Metro Vancouver gas prices through the fall, but there will be points of volatility — if you see a good price for gas, take advantage of it while you can.

“The market will remain tight and struggle to absorb any bumps in the road. I personally now just top up my tanks when I see a good price because I am not sure I will find one when I need it, and I buy a cup of coffee when I fill up at a great price because the retailer does better on my coffee than the gas and I want to reward them for helping me fill up for less.”