Chart of the Week: Pressure at the pumps  

Gasoline prices have surged. A key driver is the price of crude oil, which has jumped since the war in Iran started. But it’s more than just oil. The market for gasoline is also tight. Indeed, the “crack spread”—the difference between the market price of refined petroleum products—like gasoline, diesel fuel, and jet fuel—and the price of a barrel of oil has widened.

Summer driving demand and low inventory levels, coupled with unplanned refinery slowdowns and early preparations for autumn turnaround maintenance, have kept North American crack spreads elevated above historic seasonal norms.

Diesel prices have seen even larger gains, raising input costs for farmers.

In Canada, the federal government announced it will keep its 10 cents/litre gasoline tax holiday in place until January 31, 2027 (4 cents/litre for diesel and aviation fuel). This has helped, but not enough to offset pressure from oil and crack spreads as shown in our Chart of the Week.