(File Photo/paNOW Staff)

By Jaryn Vecchio

Gas Prices

Federal carbon tax increasing. What does that mean for gas prices?

Apr 1, 2022 | 8:00 AM

The federal carbon tax is officially increasing which could lead to a jump in prices at the gas pump.

Starting April 1, 2022, every tonne of carbon emissions will cost whoever generated it $50. The price originally started at $20 per tonne back in 2019 but it’s been increasing by $10 every year.

Dan McTeague with Gas Wizard told paNOW the tax could lead to a two cent increase per litre of gas.

However, he believes prices most likely stay the same for communities in the province.

“Best guess is right now the price is going to probably remain where it is $1.68, $1.69 range.”

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GasBuddy is also projecting a possible two-cent increase adding it likely won’t feel significant due to the already high prices.

Meanwhile, McTeague noted gas prices could see a drop this weekend.

This comes as U.S. President Joe Biden announced they would be releasing some of the country’s oil reserves to help offset the costs.

The reason prices are so high is because of demand as Russian oil, which is currently being sanctioned because of the war in Ukraine, made up a big chunk of the world’s supply.

“(Biden’s) giving markets the indication that he might be able to put another million barrels of oil into the markets,” said McTeague.

Whatever the drop, he added it will most likely be temporary.

“If any decreases take place over the next week or so, they might be absorbed by the increase from the switchover from winter to summer gasoline.”

Like every year, Canada is set to replace its winter-blend gas with summer-blend. This is expected to increase prices by around five cents per litre.

Winter gas includes more Reid Vapor Pressure (RVP) which is needed to help engines avoid starting hard and running rough.

Summer gas is typically more expensive, though it’s known to have better mileage. All gas must be replaced by April 15.

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Jaryn.Vecchio@pattisonmedia.com

On Twitter: @princealbertnow