TORONTO – The closure of the colonial pipeline is causing serious disruption in the eastern United States. As a result, experts say motorists in some parts of Canada may pay more at the pump.
“People may think this is a US issue because of the supply of petrol and watnote, but they do not understand that petrol prices in Canada are made in the United States,” said Roger McKnight, chief petroleum analyst at N-Pro International. A phone interview with CTVNews.ca.
The colonial pipeline has been shut down since last Thursday after being targeted by ransomware cyberdock. This led to widespread panic purchases at the pumps, which ran out of fuel for thousands of gas stations across eastern America. Gas prices in the United States have crossed $ 3 per gallon nationally for the first time since 2016.
Offer Baron, professor of operational management at the Roadman School of Business at the University of Toronto, compares the price relationship between the United States and Canada to two gas stations at the same meeting.
“One of them raises the price the minute, the other raises the price immediately. One of them takes the minute to lower the price, and the other takes a while to lower their price,” Baron told CDV News in a video call .ca.
McKnight says petrol prices in eastern Canada are closely linked to US wholesale prices and New York port oil prices.
“Southern Ontario is based on buffaloes, New York and Rochester, (NY) on a daily basis. Wholesale prices move. .
“It will affect prices here in Canada. Even if there is no shortage of petrol in Canada, it does not matter.”
Gas prices in eastern Canada have already begun to crawl. According to the CAAOn Wednesday, the average gas price was 1.7 cents higher than last week in Ontario and two cents in Quebec. Nova Scotia and New Brunswick rose 3.8 cents and 2.5 cents, respectively, while gas prices on Prince Edward Island rose 2.6 cents. Newfoundland and Labrador saw the biggest increases in the country, with prices rising 4.3 cents over the past week. The average price across Canada was 129.0 cents per liter, up from 128.3 cents last week.
Prairies and BC. There has been no change in prices since last week. Magnite did not expect gas prices in these provinces to be affected by the colonial pipeline.
“Basically, prices west of Thunder Bay don’t really follow anything we call New York Harbor,” McKnight said.
Even if the colonial pipeline beats cyberattack and starts coming back online, even if the company promises to do it by the weekend, Magnite does not expect the troubles to end immediately.
“It doesn’t start overnight. It takes a week or 10 days to get this thing done. So, it’s very interesting for states on the east coast and in southern Ontario, Quebec and offshore states,” McKnight said.