Motorists were forced to pay more at the pumps Thursday as gas prices spiked by as much as five cents a litre in some parts of Canada.
On Wednesday, gas prices at some stations in Mississauga, Ont. were reported at 98.8 cents by , a website that tracks gas prices across the country. Stations in the same area listed prices at more than $1.04 per litre on Thursday.
The same price spike was also reported in Quebec with the average price for regular unleaded gasoline in Montreal rising from $108.551 to $112.576 per litre overnight.
Prices in Western Canada, where gas prices are generally lower, saw a slight surge. The average price in British Columbia rose about a cent from $106.432 per litre of unleaded gasoline on Wednesday to $107.539 on Thursday.
Liberal MP Dan McTeague, known for monitoring gas-price trends, told CTV.ca that the rise in wholesale gasoline prices and a lack of refinery capacity in Canada have a crucial affect on prices at the pump.
"The wholesale prices in Canada are stubbornly four to six cents a litre above those in the United States at any given time," he said Thursday from Ottawa.
"The wholesale yesterday in the United States was $64.25 per litre while it was $68.50 in Toronto."
Canadians experienced a reprieve from large price hikes at the pumps in recent months, making this most recent surge all the more dramatic.
"I haven't seen a 3.4 cents to five cents a litre increase probably in several months, it's been bumping up and down a penny or so everyday so the increases have been more spread out and therefore not as noticeable even though they are high relatively speaking to the past couple of years," McTeague said.
"But this was a sudden dramatic change during the day yesterday and those prices were instantaneously passed on to consumers; a function of how hyper sensitive the industry is here in Canada."
Jason Toews, founder of gasbuddy.com, told CTV.ca on Thursday that the dramatic spike is also likely caused by the fluctuating Canadian dollar.
"With the Canadian dollar going up previously, the increases in the price of gas were muted a bit because crude oil is priced in U.S. dollars per barrel and you can get more barrels when the Canadian dollar goes up," he said from Regina.
"Now that it has been going down, we're starting to see some of the effects of that in gas prices. We're basically just playing catch up with the U.S. prices."
Toews says Canadian gas prices today are up 20 per cent more compared to the same day last year.
Oil was trading around US$94 on Thursday after spiking nearly $4 on Wednesday. Oil hit a record at $99.29 on Nov. 21.
"Crude oil is around $90 per barrel and has been there for the past month or two now and that's really high historically speaking," Toews said.
Gas prices fluctuate seasonally throughout Canada but price hikes are usually felt in the spring and summer months making today's spike abnormal Toews said.
"It's unusual to see gas prices being this expensive in the winter because usually gas prices go way up in the summer due to increased demand," he said.
"In the winter demand goes down and we usually see gas prices go down because gasoline is a supply-and-demand commodity."
Canadian motorists concerned with saving money at the pumps during the holiday season should alter their driving habits to increase gas mileage, Toews recommends.
Besides car pooling, taking public transit, and researching the lowest local price, he recommends slowing down and accelerating and breaking smoothly to increase fuel economy.
"Most vehicles hit optimal fuel economy around 100 kilometres per hour or even slightly slower. So, if you don't go 120 kilometres per hour you could save 15 per cent by reducing your speed," Toews said.
