Gas prices in Canada are sky-high again. Here’s how to save money at the pump

Much of Canada’s oil is refined at home. According to Natural Resources Canada, Canada is a net exporter of crude oil, which means it produces more oil than it needs. The cost of sourcing crude oil from the ground is part of the equation when pricing gasoline. However, that doesn’t make up the entire picture. Below are some of the other factors that affect the price of gas.

• Taxes: Provincial governments tax gasoline differently. These taxes, plus federal and sometimes municipal taxes, affect the price you pay in your region.
• Retail markup: Like any product, gas and diesel have retail costs associated with them that are passed on to consumers.
• Wholesale costs: Also known as the commodity price, this is the cost that the provider is paying, which affects the price drivers pay.
• Political turmoil: As we’ve seen with conflicts for many decades, most recently during the war in Ukraine, a lack of oil and gas production can affect prices at the pump. Scarcity inevitably leads to higher costs.
• Environmental instability: Climate change is having a consistent impact on the oil and gas sector. Refineries sometimes have to shut down for prolonged periods if it’s not safe to operate, which slows production and can put pressure on gas prices.
• Provincial and national regulations: National policies like Canada’s Clean Fuel Regulations also have an impact on the price at the pump. This is especially true of provinces like Alberta and Saskatchewan that have traditionally had a high reliance on fossil fuels to power their economies.

Download a gas prices app

Apps like GasBuddy — whose Canadian founders are from Saskatchewan — allow you to locate the lowest fuel prices in your area, help you plan your trip, and can also provide you with key information about your vehicle regarding recalls. Keeping a tool like this handy can help make fuel cost reduction a part of your regular driving routine.

Use a credit card that rewards gas purchases

Some cash back credit cards offer a high earn rate for fuel purchases. For example, the CIBC Dividend Visa Infinite Card offers 4% back on gas purchases. The CIBC Costco Mastercard also offers 3% back on Costco gas purchases, while the TD Cash Back Visa Infinite card offers 3% back on gas and gas station services or products. Most major banks have at least one credit card that offers some kind of reward for gas purchases, so it might be worth switching over if you’re really feeling the pinch as you drive.

Get your gas somewhere like Costco

Wholesale discounts aren’t just for giant boxes of cereal. Buying your gas at locations that offer membership discounts, like Costco, or purchasing it somewhere where you get cash back automatically at the end of the year while supporting your local community (like a Co-op gas station) can be great options to access cheaper gas prices. For example, according to GasBuddy at the time of writing, Costco gas in Scarborough, Ont. is eight cents cheaper than other nearby stations.

Drive a more fuel-efficient car

Some cars have high fuel consumption while others consume less fuel per kilometre. Fuel-efficient vehicles can help you save on your total annual gas expenses. Doing your research on the most fuel-efficient cars in Canada is a good place to start.

Some of the more fuel-efficient cars in Canada include:

• Toyota Corolla Hybrid
• Mazda MX-5
• Kia Niro FE

Consider switching to electric

If you have the means to purchase one, opting for an electric vehicle eliminates the need for gas altogether, which can save you money long-term. Even a plug-in hybrid can give you a balance between fuel efficiency and reliability. And a regular hybrid, which will use its systems to recharge the battery and use less fuel, can also be a great option.

Recent data from Canada Energy Regulator found that the most fuel efficient plug-in hybrids could consume as low as 3.6L per 100 KM. Meanwhile, a gas-powered vehicle of the same size uses 10.6L over the same distance.

Alter your driving habits for fuel efficiency

According to Natural Resources Canada, there are a handful of driving techniques you can adopt to be more fuel efficient. These can significantly reduce not just your gas bill, but also your carbon footprint. They include:

• Driving at a steady speed to lower fuel consumption
• Use your air conditioning sparingly
• Not pinning your foot to the floor when you are accelerating
• Avoid idling for more than 60 seconds where possible
• Coasting to slow your speed where appropriate instead of braking

Rely on public transit

For some, particularly those in rural areas or for many of those living with a disability, not using a car may be out of the question. However, if it’s a possibility for you, taking public transit may be a cost-effective option. City driving often means more frequent braking and rapid acceleration, which burns gas. If you take public transit for getting around the city and rely on your vehicle only for highway driving, you might see a noticeable difference in fuel consumption.

Canada’s fuel prices are not expected to drop any time soon. Experts are forecasting a very costly end to 2023 when it comes to oil and gas. This is partially due to oil supply decisions made by international bodies like the Petroleum Exporting Countries (OPEC) (which can drastically impact how much oil is available), but it’s also impacted by how oil refineries are susceptible to production challenges when the weather renders them inoperable.

However, keeping an eye on price trends and doing your best to mitigate costs can ease the burden you see when you’re given your receipt. High fuel costs don’t have to be inevitable if you’re intentional about where you buy gas and open to making adjustments to how you get around.