Forget $2 a liter: Metro Vancouver gas prices jump to $2.10 and more Sunday

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Drivers in Metro Vancouver didn’t have long to fret over $2-a-liter gas before they were seeing still more record highs.

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Many gas stations across Vancouver, Richmond, Surrey, Burnaby and beyond were tipping $2.10 a liter Sunday, with the cheapest stations charging about $2 and a few even soaring upwards of $2.20.

The never-before-paid prices are a reflection of global supply concerns brought on by the Russian invasion of Ukraine, as companies that buy or transport oil are reluctant to touch the country’s output, fearing it will be subject to sanctions.

Still, it’s a perplexing degree of sticker shock given that Canada barely imports any petroleum from Russia. Most of the coastal BC supply comes from an oil refinery in Burnaby and ones in Edmonton (through the Trans Mountain pipeline) and Washington state, which are largely unaffected.

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Werner Antweiler, a business professor at the University of BC who specializes in international trade, gas prices and energy systems, said that because oil producers sell their products competitively on global markets, local prices are affected by worldwide events.

“We are at the mercy of international markets,” he said. “Crude oil is traded in monthly futures contracts and not in low-term contracts. If international prices are up, they will gain that benefit in all their markets.”

Companies that make a profit by bringing in oil from anywhere — often from Alberta — for cheaper and selling it at the higher price, taking into consideration the cost of transportation, currency exchange, inflation and fuel standards, have begun to look elsewhere.

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Antweiler pointed to the price of oil benchmarks: Brent crude, which topped US$112 per barrel, and West Texas Intermediate, which traded at about US$116 early Sunday.

As the busy driving season dawns in spring and summer, rising demand in North America is also expected to keep the cost of petroleum high.

The only feasible relief in sight is if extra supply makes its way from Saudi Arabia, the United Arab Emirates or the United States to retail pumps, said Antweiler. Another potential source is Iran if sanctions related to its nuclear program are lifted and more oil could flood into the marketplace.

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BC only has two oil refineries, in the north and in Burnaby.

Governments also add provincial and federal taxes, including BC’s carbon tax, which is expected to add another cent to the cost of a liter of gas this April.

“Right now, the first BC carbon tax is 10 cents per liter of gasoline,” said Canadian Taxpayers Federation spokesperson Kris Sims.

“The second carbon tax is a fuel standard regulation that increases the cost of gasoline by roughly 17 cents per liter. By the year 2030, those two combined carbon taxes will cost BC drivers more than 50 cents per liter of gasoline.”

As a result of the supply-chain shortfall and increased taxation, Crown corporations have resorted to adding fees to cover fuel costs for their fleets. BC Ferries implemented a one-per-cent fuel surcharge Tuesday, adding 15 cents for adult passengers and 55 cents for a vehicle to the cost of sailings.

The hot prices are also expected to pass on the increased transportation and delivery costs of farming, agriculture and forestry products to consumers.

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