Gas expert recounts what happened at the pumps throughout 2023 with hope for 2024

With the focus of the nation's attention on carbon tax and all of Manitoba's eyes on gas tax holiday, we take a look back at 2023 and how prices fared throughout this last year.

Canadians for Affordable Energy President Dan McTeague, who also runs Gas Prediction Site Gas Wizard, says everyone expected things to be a repeat of 2022. That was when the highest prices ever paid in Canada for fuel prices hit the highest on average of about $2.14 a litre in June of 2022.

"There was an expectation, myself included, that we would revisit those numbers, given what was happening in the battle between Russia's attack of Ukraine and other geopolitical tensions," says McTeague. "We also were mindful of what OPEC was doing that was cutting back production. By doing so, there was a real belief that 2022 would be repeated in 2023."

Portage Gas in June 2022

He says that clearly didn't happen, and especially diesel prices remained about $0.30 a litre less than 2022 on average, thankfully. He explains gasoline was at about $0.18 less on average for 2023 versus 2022. 

"There were times when with a lot less than that, of course, but that also allowed the Bank of Canada to take some solace from the fact that the inflationary pressure driven by energy, which costs everything to really rise in tandem, is now starting to signal that there isn't the inflationary pressures," notes McTeague. "While there are many pressures -- housing being a good example, population increase, migration -- gasoline and diesel tend to be the big elephants in the room that were driving energy prices up and as a result, inflation."

He explains the story coming out of 2023 sets the stage in 2024 for the Bank of Canada to reconsider its high monetary, high inflation, and its high-interest rate policies, seeing as prices dropped comfortably.

"If energy prices maintain this kind of trajectory in 2024, it will bode well, I think, for demand as well as in overall inflationary pressures," adds McTeague. "I think it's a very much a welcomed outcome; perhaps a surprise for all of us in the new year."