Nunavut could see higher gas prices next year as global market spikes
About 71 per cent of next year’s fuel purchased so far, territory’s petroleum division says
If gas prices stay high across the world throughout the spring and summer, Nunavummiut could be paying more for fuel in 2023.
Nunavut’s gasoline supply is purchased a year in advance and delivered during the following sealift season. This means the price the government’s petroleum products division pays for gas this year will affect the cost people pay at the pump next year.
So far, the division has purchased about 71 per cent of Nunavut’s fuel set to be delivered on the next sea lifts.
“PPD secured the product between November 2021 and February 2022 before the extreme volatility of markets we are witnessing today,” Suleikha Duale, a spokesperson for the territory’s Community and Government Services Department, said.
Duale said if global market prices remain high into the summer, it could effect next year’s prices.
The petroleum division monitors world fuel markets year-round and could buy more fuel as early as November for delivery the following year, depending on how much money is left in its budget.
Russia’s recent invasion of Ukraine and the sanctions Canada and other countries have imposed against Russia — one of the world’s largest producers of oil and gas — have caused fuel prices to spike across Canada.
In Ontario, for example, gasoline prices have ranged from $1.55 a litre to $1.86 a litre over the past month.
On Friday, the price was $1.64 a litre on average in the province, according to the Canadian Automobile Association’s national gas price calculator.
Gas prices in Iqaluit are $1.25 a litre.
So far, the PPD has paid about 73 cents a litre for fuel set to be delivered to Nunavut this year, without counting the price of shipping, Duale said.
Solomon Malliki, the MLA for Aivilik, asked Community and Government Services Minister David Joanasie about fuel prices in the legislative assembly on Tuesday.
Malliki asked if Nunavummiut should expect gas prices to rise even more, considering a price increase of eight cents a litre was already announced in February — before the global market was affected by Russia’s invasion of Ukraine.
At the time, a department news release about the increase said it reflected “rising costs on world crude oil markets.”
Joanasie said “oil prices are quite volatile in our world situation,” adding the U.S. benchmark price for oil was trading at about $120 per barrel, an increase of about 225 per cent in just over a year.
He said he couldn’t yet say whether there will be another price increase.
But, Joanasie said it’s certain the carbon tax on fuel coming into effect April 1 will cause an increase in price.
“We are trying to mitigate any further price increases, but with the world market we have to deal with the consequences,” he said.
I don’t think Nunavut realize how lucky we are to pay the cheapest gas in Canada. In Sach’s Harbor and Paulatuk NWT gas is almost always about 10 bucks a gallon. Oil is above 100 bucks a barrel, only a matter of time before prices for groceries and plane tickets goes way up too.
GN’s PPD shouldn’t of increased the prices of gas and fuel. It was already bought and delivered. Diesel fuel fir a house cost $233.91 a barrel now at $1.1346 per litre.
Just wait until next year when the price increases to $1.78 or higher.
And food prices look more like their “before subsidy” prices.
Y’all hooked on gas water now
1. There should be no carbon tax in Canada this year. The justification for the carbon tax was that, by raising the cost of fuel, people would be inclined to look for alternatives.
The war in the Ukraine has raised the price by more than the intended carbon tax. So the increase is already in the price. The federal government said it would tax carbon and give the money back to Canadians. No need to double-tax.
2. Get ready for massive inflation. I doubt inflation will be less than 20% by the end of 2022. I expect inflation in 2023 will be higher than in 2022.
3. The NEU contract needs to have a monthly inflation escalator clause. Otherwise, the only people who will work for the GN are those who cannot afford to leave Nunavut.
4. Hope I’m wrong. But I doubt it.
You are wrong,
Yes inflation is currently very high, I believe the latest indication is 7.2% which is quite a ways from the 20% you forecast. We know that most of it has been caused by the Covid-19 pandemic with governments printing money as people were out of work, and due to goods shortages.
Now the spiking gas price due to Russia’s unprovoked invasion of Ukraine isn’t helping but that, and the effects of the pandemic, will be temporary. And to be honest a lot of the inflation is due to corporate greed. Many companies are reporting record profits. The NDP has proposed a windfall profit tax, IMHO it’s needed.
As for climate change we need to do more, and we need to do it more urgently. We are past the point where climate change will have adverse economic effects. The question is can we mitigate climate change enough to prevent a global al catastrophe? Given the world’s response to the Covid-19 pandemic, yeah we’re likely screwed.
By creating covidmania and political mayhem, putting people out of work, Trudeau is using the benefit of my hatd work to underwrite printing money as a way to buy votes and condition the masses
Then just to keep the fear-factor bubbling, NATO provokes Russia’s
“As for climate change we need to do more, and we need to do it more urgently.”
It would take every gram of energy, every resource, inclufing every moment of everyone’s time to try to change Earth’s climate, and then to no avail. That’s nature’s job; humans can affect the climate
“Given the world’s response to the Covid-19 pandemic.”
The world’s ‘response’ was to create covidmania, not because of a health crisis, but because of a political mandate.