Fuel prices for diesel in Canada are surging due to global conflicts, making it costly for trucks transporting goods, experts warn. The Canadian Truck Operators Association’s Tej Dulat expressed concerns over the significant impact on trucking companies as a commercial truck consumes hundreds of liters of fuel weekly, with prices soaring since 2022 amid the Russia-Ukraine conflict. With diesel prices hitting $2.62 per liter nationwide, exceeding last year’s rates, consumers may soon face increased grocery costs.
In some regions like Vancouver, diesel prices reached $2.92 per liter, while in the U.S., diesel prices hit a record high of over $6 per gallon. Experts note that geopolitical tensions are currently playing a larger role in fuel price spikes compared to tariff concerns on Canadian goods. The ongoing U.S.-Israel conflict with Iran is a key factor driving high oil prices, potentially leading to inflationary pressures on other goods.
The diesel supply shortage is a critical issue, with exports from the Persian Gulf plummeting post-conflict. Russia’s ban on diesel exports and the closure of Canada’s largest refinery in New Brunswick due to maintenance further strain diesel availability. Despite the temporary suspension of the federal fuel excise tax extension, experts believe it is insufficient in mitigating rising costs, posing a substantial threat to the North American economy.
Energy analyst Dan McTeague warns of potential price hikes in winter, impacting various industries and consumers. The University of Guelph’s Evan Fraser highlights the cascading effects of diesel price increases on the food supply chain, exacerbated by external factors like extreme weather events affecting harvests. Concerns arise over a prolonged period of elevated food prices due to shifting global trade dynamics and energy price volatility, particularly impacting low-income Canadians in the short term.