With escalating diesel costs attributed to ongoing global conflicts, the expense of refueling trucks transporting goods across Canada has surged, experts reveal. This surge in prices could soon impact Canadians, according to Tej Dulat, the director of government and public affairs at the Canada Truck Operators Association.
Dulat highlighted that commercial trucks consume substantial amounts of fuel weekly, making it one of the primary expenses for trucking companies. While the industry typically can absorb short-term price spikes, the margins have tightened since the 2022 price surge following the Russia-Ukraine conflict.
Presently, diesel prices have soared even higher, standing at $2.62 per liter nationwide, surpassing last week’s peak of $2.52. This marks a significant increase from a year ago and exceeds the highest weekly average in 2022, which was $2.30. In certain regions, such as Vancouver, prices have reached $2.92 per liter.
The increase in oil prices, driven by geopolitical conflicts, is overshadowing concerns about tariffs on Canadian goods, experts note. The scarcity of diesel is exacerbated by geopolitical tensions, with the Persian Gulf region witnessing a drastic drop in diesel exports. Russia, a major diesel producer, has extended a ban on diesel exports due to damage inflicted on Ukrainian oil refineries.
Moreover, Canada’s largest refinery, the Irving Refinery in New Brunswick, is currently undergoing maintenance, impacting diesel production. Despite the federal government’s decision to extend the suspension of the fuel excise tax on diesel, experts caution that this measure may not sufficiently offset rising costs.
Looking ahead, there are concerns that the heightened diesel prices, especially as winter approaches, could lead to a costly season for various industries and consumers. The implications of these escalating prices are far-reaching, affecting the entire food supply chain. Experts warn of potential long-term impacts on food prices, creating challenges for low-income Canadians in the foreseeable future.
