It seems Canadians will have to wait a little longer for more relief at the gas pump.
The Canadian Automobile Association (CAA) currently lists the national average gas price at 171.8 cents per litre, an increase from the 169.1 cents per litre average last week.
“Prices had initially dropped considerably last week after the excise tax was paused. Most Canadians saw a decrease of virtually the entirety of the 10-centilitre excise tax,” said Patrick de Haan, a petroleum analyst at GasBuddy.
“We saw a bit of the relief passed along. I’m glad that Canadians could see that. But unfortunately, now the temporary improvement in prices is rolling back because oil prices continue to rise.”
On April 14, Prime Minister Mark Carney announced a temporary suspension of the federal fuel excise tax, which began last Monday and is set to last until Labour Day.
This also included removing the fuel excise tax on aviation fuels, which Carney stated would “remove up to $0.10 per litre on gasoline and $0.04 per litre on diesel fuel.”
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Carney said the cost of this measure will be $2.4 billion.
The suspension is largely due to the ongoing U.S.-Iran war, with the movement of shipments along the Strait of Hormuz having mostly been stalled.
De Haan also stated that as the week progressed, the price of oil went up “considerably,” resulting in increases in fuel prices.
Without a deal surrounding the Strait of Hormuz, oil prices will only continue to rise, and elevated fuel prices could be present for “months,” he added.
“This is going to be a trend consumers should expect that prices may continue to climb in the days and weeks ahead until there is some sort of longer-term resolution when it comes to reopening the Strait of Hormuz,” he said.
“Even if the government were to decide to stop collecting HST or GST on fuel tomorrow, that doesn’t prevent the price of oil from going up to potentially offset any of the savings from additional reductions in taxes.”
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