B.C. gas prices to rise as North American supply tightens

The price of gas in the Lower Mainland is tipped to rise another seven cents into Thursday, as oil prices and tight supply hit the region again.

Paul Pasco, the principal consultant at Kalibrate, says prices will hit around $1.98 for a litre of regular by the morning.

“It’s just the rising price of crude. There’s been a continued supply tightness globally and it’s pushing prices up, and we’re seeing it across the market,” he told CityNews.

Pasco says the rise is happening across all North American markets, “a steady increase” in costs everywhere, he notes.

Related Articles:

• Gas prices to drop again in Metro Vancouver, expert says

• Inflation rate 6.9% in September as grocery bills continue to climb

• BC Ferries increasing fuel surcharge

There’s potential for the price at the pump to continue to rise, Pasco adds, as there’s not a lot of room in the market for prices to fall, considering “we’re already pricing in a recession.”

“Any news that’s at all positive on the economic front or negative on the supply front is going to continue to push the price of crude oil [up], which will push prices a little bit higher.”

As many pundits believe prices at the pump will stay below $2 a litre through the end of the year, Pasco says it’s a possibility, saying he doesn’t see a lot of changes happening in the crude oil market.

“I think the big risk right now would be some substantial changes in China that could lead to increased demand over that region. But outside of that, I don’t see any major drivers in the market that should push prices up,” he said. “But it is not impossible.”

While Pasco says a recession and a possible fall in demand for crude oil across the globe could drive down prices, he notes the recent OPEC cuts, along with the United States releasing its petroleum reserves, are factors balancing themselves out.

“There’s not a lot of extra supply. And so, unless we see a substantial change in demand, I don’t expect that even with a recession we’ll see gasoline prices fall.”

-With files from Sonia Aslam