Canada: Are consumers getting stiffed at the pump? - NBF

Krishen Rangasamy, Senior Economist at National Bank Financial, notes that more than 11% of Canadian retail spending was on gasoline in the second quarter of 2018, that’s almost three percentage points higher than in the U.S., the biggest difference between the two countries ever recorded.

Key Quotes

“Recall that in early 2010, the gap was close to zero. So what has happened since 2010 that caused Canadians to be punished at the pump more harshly than their American counterparts?”

“As it turns out, gasoline prices have risen 33% since the first quarter of 2010 in Canada compared to a less than 8% increase in the U.S.”

“In USD terms, however, the gasoline price increase in Canada since 2010Q1 is very similar to that seen stateside. In other words, if you think Canadians are getting stiffed at the pump, blame the Canadian dollar’s depreciation, not refiners.”