Market Snapshot: Weekly average gasoline prices in Canada reach the lowest level since 2008
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Release date: 2020-04-22
Weekly average gasoline prices in Canada dropped to 80.2 cents per litre (c/litre) on 21 April 2020.Footnote 1 Overall, pump prices fell by 27% over the past six weeks (10 March 2020 to 21 April 2020) representing the largest six week decline since 2008. The last time nominal gasoline prices were this low was during the 2008 financial crisis when prices dropped to 71.7 c/litre. Real gasoline prices, which are adjusted to reflect the purchasing power of a Canadian dollar over time, have not been this low since at least 2002.Footnote 2
Weekly prices generally fell the fastest in Maritime Provinces, with Halifax’s prices decreasing 35% over the past six weeks to 69.9 c/litre on 21 April 2020. Prices in western Canada fell less−however, Vancouver pump prices fell by 45 c/litre in the past six weeks, the second largest c/litre drop in Canada behind nearby Abbotsford B.C. Pump prices continue to show big differences across Canada with the lowest price in Edmonton at 61.3 c/litre, and the highest price in Whitehorse at 100 c/litre. In the past three weeks (31 March 2020 to 21 April 2020), average prices in Canada leveled off following large declines throughout March.
Figure 1. Nominal and real gasoline prices over time
Source and Description
Source: Kent Group, Statistics Canada
Description: The map and time series chart displays the nominal and real weekly gasoline prices with data up to 21 April 2020. In the past six weeks, the average gasoline price fell from 110.5 c/litre to 80.2 c/litre. At the beginning of the time series, gasoline prices averaged 63.9 c/litre on a nominal level and 68 c/litre on a real level, where the value of the Canadian dollar is normalized to 2002 levels. On 21 April 2020, real gasoline prices averaged 58.2 c/litre, using the February estimate for CPI.
Gasoline prices fell for two main reasons. First, international attempts to slow the spread of COVID-19 reduced demand for transportation fuels such as gasoline and jet fuel.Footnote 3 Secondly, the price of crude oil, which is one of the main input costs for gasoline, fell significantly in Canadian and global markets because of decreased demand from refineries and the potential for global crude oil oversupply in the short term.Footnote 4
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