Lower Mainland gas prices could hit $2.30/L by mid-April: expert

Gas prices have been steadily climbing around the Lower Mainland this week and it’s about to get much more expensive.

Initial predictions had drivers in Metro Vancouver paying $2.30 a litre for regular gas by the May Long weekend, but that prediction has been moved up to mid-April — just a couple of weeks away.

“It’s aggravated by the fact that refinery maintenance is not yet wrapping up. In fact, a couple of refineries in Washington state are still undergoing maintenance. That’s the big wildcard, is will that maintenance be done as expected or will it take longer?” said Patrick De Haan, head of petroleum analysis at GasBuddy.

“Supply is growing rather tight in the Pacific Northwest right now.”

“The average price now is well above the $2 a litre mark and just about ready to jump over last year’s peak of $2.15 a litre,” he adds.
De Haan explains there are a few reasons for the increases, including the recent increase to B.C.’s carbon tax on Apr. 1.

“The price of oil is at its highest level since October of last year. Refinery maintenance is ongoing in areas of Washington state. Thankfully, the Parkland Refinery in Burnaby is back online — that’s going to help things in the next couple of weeks as supply does start to build up.”

De Haan says gas stations are also transitioning to a more expensive summer blend of fuel and demand is going up.

However, if you were hoping prices would drop to below the $2 mark, he says you’re out of luck, adding that price tag will stick around through the summer.

“The underlying price of gasoline is much higher on the West Coast, again, because a limited amount of refineries produce this blend of gasoline for the West Coast.”

De Haan is hopeful things will stabilize by June but he’s not making any guarantees.

“Hopefully, by no later than June, we will start to see some downward momentum emerge. We’ll probably still be above the $2 a litre mark but instead of $2.30, I’d be hopeful that we could see prices sink to $2.20 or maybe $2.10, if we’re lucky. There are a lot of developments that could change the prognosis for where prices go or how high they go.”

He adds the other situation to keep an eye on is what’s happening in the Middle East and the impact that has on oil prices.

“Oil prices are now $10 a barrel higher than where they were just about six weeks ago … that could cause prices to go up, as OPEC maintains a very tight balance [and] is calling on its members to continue to cut oil production to keep the price of oil much higher.”

He says prices tend to plateau in April and May and then trend lower in the summer.

Current gas prices in the Lower Mainland are the highest anywhere in North America, with much of the rest of Canada having not hit the $2 mark.