No end in sight to rising gas prices in Okanagan, Kamloops

As the U.S.-Israel war on Iran enters day 17, the effects on the global oil market continue to worsen, and Kamloops and the Okanagan aren’t insulated.

Today, March 17, the typical gas price in Kamloops and the Okanagan is around $1.79 a litre.

In Kelowna, the spread between the top ten cheapest gas prices is $1.619 to $1.799, in Kamloops it’s $1.699 to $1.799, for Vernon it’s $1.587 to $1.799 and in Penticton it’s $1.58.8 to $1.799, according to GasBuddy.com.

The cheapest local gas price for Kelowna has gone up $0.54 in the past month.

Before the war, on Feb. 17, the cheapest gas in Kelowna and Vernon was around $1.07 per litre. In Kamloops the cheapest gas was $1.29 and in Penticton it was $1.31.

The B.C. average is $1.87 a litre, the highest in the country.

Patrick De Haan, GasBuddy.com’s head of analysis, said that consumers are in for a tough ride since the war constraints are combined with the usual increase in demand for fuel during the spring. It’s not certain how long the war in Iran will last but its long-term effect on oil prices is a certainty.

“It becomes more and more likely every day that we’re going to see the $2 a litre mark,” he said. “Prices will not go back to pre-war levels until probably later this year… as long as everything’s resolved.”

The war has shut down the Strait of Hormuz, which roughly 20 per cent of the world’s oil passes through, spiking oil prices around the planet. De Haan said reopening the strait would drop prices, but they would still likely be higher than they were in February as the market readjusts.

For the typical driver, De Haan said the only practical thing would be to change driving habits to try to reduce people’s need for gas.

“Making sure you’re trying to drive more fuel efficiently certainly is one of the best things that motorists can do in times like these. Try to get as much distance as you can out of a tank, slow down, reduce your acceleration, combine your trips,” he said.

De Haan said a common reaction is to blame oil companies and politicians, but interventions to artificially drop gas prices like lowering taxes could do more harm than good.

“Politicians’ knee-jerk reaction is to want to help, but it could exacerbate the problem by not reducing demand, and potentially increasing demand, at a time when the global market needs to reduce demand in order to reduce price,” he said.

Brent crude oil was $71 USD on Feb. 27, now it’s up to $103 USD.

De Haan said Canadians are going to have to buckle up alongside the rest of the world.

“Although Canada being a major oil producer certainly does insulate itself from the realistic supply disruptions,” he said. “It’s not just Canadians paying a higher price, it’s Europeans, it’s Americans. Unfortunately this is the reality of the global market.”