Ontario Fuel Prices Spike Then Drop for Holiday Weekend

Fuel prices in Ontario experienced a brief spike followed by a projected decline during the August Civic Holiday long weekend. On July 31, gasoline rose 3 cents to 179.9 cents per litre and diesel increased 9 cents to 227.9 cents per litre. Dan McTeague, president of Canadians for Affordable Energy, attributed this volatility to mixed signals from the Middle East following a surprise attack on American forces.

Prices are expected to reverse trend immediately following the Friday hike. Gasoline is projected to drop six cents to $1.73 per litre on Saturday, while diesel is expected to fall seven cents to $2.19 per litre. An additional three-cent decrease for gasoline is anticipated on Sunday, August 2, though diesel prices are expected to remain stable.

The Bank of Canada noted that reduced global refining capacity and strikes near the Strait of Hormuz have kept refinery margins high, sustaining fuel costs despite global oil prices fluctuating between US$75 and US$87.55 per barrel. The central bank warned that if oil prices remain elevated, it could broaden inflation and potentially influence the bank's monetary policy response during its September 2 interest rate decision.