An op-ed, short for “opposite the editorial page”, is a written prose piece, which expresses the opinion of an author usually not affiliated with the publication’s editorial board.
Gas prices are displayed at a ESSO gasoline station near Newcastle, Ont., Friday, March 4, 2022. THE CANADIAN PRESS/Doug Ives
Editor’s Note: Prince Albert-based economist Kaase Gbakon did some hard number crunching on gasoline prices. This is Part 2 of 2.
Key Take-Aways
- The difference between the highest and lowest retail prices has widened across all fuels since January 1990.
- Diesel prices have historically been highest in the North, but Western and Atlantic Canada locations have started recording the highest diesel prices in the last decade.
- Historically, diesel prices have been the lowest in Western Canada. However, Halifax, NS has started to record the lowest diesel prices in the country in the last 3 years.
- Household heating oil has historically been the highest in locations in Western Canada. However, this changed from c. 2005 when the North consistently started to record the highest heating oil prices in the country
- These days lowest heating oil prices are found in locations in Atlantic Canada. However, Central Canada maintained a lead of the least heating oil prices between c. 1999 and c. 2008.
In this concluding part of the 2-part article, we examine the trend of retail prices of diesel and household heating oil.
Diesel
The gap between Canada’s highest and lowest retail diesel price has also widened since Jan 1990 from C$0.11/Ltr to C$0.356/Ltr in Dec. 2023. This evolution is depicted in the following graphic.
Seasonality can be noted in the trend of the diesel price range, and the moving average trend highlights this.
Let us now turn our attention to the locations where diesel prices have been highest in the country by looking at Table 1.
The Northern Territories have recorded the highest diesel prices in 257 out of 408 months, followed by locations in the West where diesel prices were the highest in 62 out of 408 months.
Once again, Victoria and Vancouver in BC have been responsible for the highest diesel prices recorded in the West.
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As previously done for regular and premium gasoline, we will investigate where and when the maximum diesel prices were recorded since January 1990. See Figure 2.
Maximum diesel prices were primarily recorded in Northern territory locations from Jan 1990 to sometime in 2010. However, maximum diesel prices have been recorded in more diverse locations since 2010.
The visual indicates that maximum diesel prices have been recorded in Western and Atlantic provinces in the last decade. Charlottetown, PEI and St John’s, NL have been responsible for the highest diesel prices recorded in Atlantic Canada.
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We turn attention to the location of minimum diesel prices. The locations in the West have recorded the lowest diesel prices 75% of the time since Jan 1990.
It is noteworthy that Victoria, BC, which usually records maximum fuel prices, recorded 3 months with the lowest diesel prices nationwide. Winnipeg, MB, has contributed the most to Western Canada’s reputation as having the lowest diesel prices in the country, followed by Saskatoon, SK.
Now, let us consider how the minimum diesel prices have evolved through time. Figure 3 illustrates.
Consistent with Table 2, locations in the Western provinces take the prize for delivering the lowest diesel prices in the country over time. Note a period between 1997 and 1999 when the lowest diesel prices were in the Central province of Ontario (see Table 2 above).
In more recent times, from Jan 2020, you can see that Atlantic Canada has provided the lowest diesel prices driven solely by Halifax, NS.
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Household Heating Fuel
Turning attention to household heating fuel, the graphic below highlights how the gap between the highest and lowest retail price of heating oil has evolved from Jan 1990 to Dec 2023.
The range of household heating oil rose from C$0.097/Ltr in Jan 1990 to C$0.517/Ltr in Dec 2023.
We look now at which locations have recorded the highest heating fuel prices in the last 30+ years.
The West has recorded the highest heating oil prices in 254 out of 408 months, driven by Victoria in BC, followed by Winnipeg, MB. This is the only fuel of the four considered, where its price has been the highest in Western Canadian locations outside of Victoria and Vancouver, BC.
The Northern territories driven by Whitehorse, YT have had Canada’s 2nd highest count of the highest heating oil prices.
For a time-dimensioned look at the highest price of heating oil in Canada, see Figure 5.
Before 2005, the locations in Western Canada and Northern Territories made up the bulk of where heating oil was most expensive in Canada. However, post 2005, the highest prices for heating oil have mostly been recorded in Northern territories interspersed with thin slivers of locations from Central province (Totonto, ON).
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Looking at the locations where the heating oil has been lowest, we see that locations in Atlantic Canada have reported the lowest heating oil prices in 266 out of 408 months, driven by Charlotte, PEI.
Locations in SK province have driven the lowest heating oil prices in the West.
Next, let us look at locations where the lowest heating oil prices have been recorded in the country.
Throughout most of the history we have looked at, locations in Atlantic Canada have reported the lowest heating oil prices in Canada. However, there was a period between Jan 1999 and Jan 2008 when the lowest heating oil price was recorded in locations in Central Canada driven by Montreal, QC.
IN SUMMARY…
Tracking the price of four fuels across Canada based on 18 geographical locations over 408 months reveals varying dynamics.
The following are observed:
- The dispersion of fuel prices (i.e. the difference between the highest and lowest price of a given fuel) has trended upwards with a display of seasonality.
- Locations in Western Canada tend to record the lowest retail prices in the country. This is except for Victoria and Vancouver, BC which tend to place Western Canada on record for the highest fuel prices.
- The country’s lowest prices for premium gasoline are recorded mostly in Atlantic Canada – PEI, NS, NB and NL. However, locations in Western Canada compete for this spot too.
- Household heating oil is the only fuel with the lowest prices, predominantly in Atlantic Canada locations – NS, PEI and NL.
- Locations in the Northern Territories also tended to record the highest prices for all the fuels. The North historically had the country’s highest regular gasoline, premium gasoline, and diesel prices between 1990 and 2011 after which other locations took over the maximum prices.
- However, for household heating oil, the North still maintains its ranking as having locations with the highest prices for this fuel (driven by Whitehorse, YT)
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