Canada's Fuel Excise Tax Pause Set to End: What It Means for Gas Prices

The temporary pause on fuel excise tax in Canada is set to expire next month, which could lead to higher gas prices for consumers. The federal government introduced the measure in April, removing the federal excise tax from retail gas until September 7.

According to Dan McTeague, president of Canadians for Affordable Energy, the removal of the federal excise tax has provided some relief to consumers, but it hasn't been able to prevent higher prices. He notes that bringing back the excise tax could mean an increase of around 10-11 cents per litre, depending on the region.

McTeague also points out that there are seasonal changes in gas prices due to different fuel blends used during summer and winter months. As temperatures drop, gas stations will begin pumping winter-grade gasoline, which is cheaper than summer blends but only available after September 15.

The Iran war has severely constrained global oil supplies, leading to higher prices. The International Energy Agency (IEA) expects global demand for oil to drop in the next few months due to higher oil prices, but risks to oil supply remain 'substantial'. McTeague warns that if the war leads to prolonged oil supply constraints, oil and gas prices could skyrocket again.