Gas prices expected to be ‘a bumpy ride’ in 2019 as uncertainty over economy hits energy
TORONTO – GasBuddy, the only smartphone app connecting drivers with their Perfect Pit Stop, today says that Canadian motorists can expect a year of extreme volatility at the pumps for 2019 as world markets move sharply in varying directions for the foreseeable future.
At the outset of 2018, GasBuddy accurately predicted a year that would see pump prices reach their highest annual average since 2014. Although the price to fill up dropped substantially in the final quarter of the year, average prices remained 13.9 cents a litre higher than 2018 at $1.242 per litre, the highest since 2014’s average of $1.263 per litre.
The expected turbulent year ahead follows the pattern of major price swings seen on both the equities and futures markets in the final weeks of 2018 as energy traders look global markets for clues of an economic rebound or continued slowdown in light stemming from concerns over a looming trade war between the U.S. and China trade, Brexit, the status of global crude supplies and overall demand for oil products. For Canada specifically, a weaker Loonie, which now stands 10 cents weaker than the U.S. greenback and Ottawa imposing a 5 cent per litre carbon tax on April 1 point to higher than usual pump prices for the spring and summer driving season as pipeline constraints and taxes continue to widen the spread between the price of oil and pump prices.
“Canadian drivers should expect a bumpy ride at the pumps in 2019 with markets fluctuating wildly given the uncertainty over the economy as a whole and energy markets being driven by a news headline sensitive stock market”, said Dan McTeague, senior petroleum analyst with GasBuddy. “With carbon taxes set to begin or increase in 8 of 10 provinces, the average hike of 5 cents per litre by April 1st, combined with a limping Loonie, will almost certainly force up the cost of filling your tank, just in time for the summer driving season and switchover to more expensive summer gasoline. The tax increases will be particularly noticeable in Vancouver which will displace Montreal as the highest taxed jurisdiction on fuel in North America.”
Although fuel prices are likely to reach 2018 levels and at times reach above seasonal highs, extra attention will need to be given to the ongoing premium of diesel prices, which are not expected to fall notably for several years. Overall, fuel prices in 2019 could well turn out to be more expensive than any year since 2014, helped in no small part by an increase in gas taxes and currency challenges.
About GasBuddy
GasBuddy is a company that connects drivers with their Perfect Pit Stop. As the leading source for crowdsourced, real-time fuel prices at more than 150,000 gas station convenience stores in the U.S., Canada and Australia, millions of drivers use the GasBuddy app and website every day to find gas station convenience stores based on fuel prices, location and ratings/reviews. GasBuddy’s first-of-its-kind fuel savings program, Pay with GasBuddy, has saved Americans more than $4.5 million at the pumps since its launch in 2017. The company’s business solutions suite, GasBuddy Business Pages, provides Fuel Marketers and Retailers their best opportunity to maintain their station information, manage their brand, and promote to their target consumer audience.