Will gas prices go up in Canada if war on Iran continues? Energy expert says they already are
Gas prices in Canada are already rising — nine cents per litre since Saturday — as the attacks on Iran entered their fifth day. Dan McTeague, a former Liberal MP and president of Canadians for Affordable Energy, predicted that initial increase and says more is on the way this week.
What’s more, if the conflict enters a second week, Canadians can expect to see upward pressure on other goods, as diesel and gasoline are needed to both manufacture and transport items across the country.
⛽️ Price ????: Update #5 #GasPrices to rise 3 cts/l Thursday while #Diesel is up 11 cts/l. Trump’s pledge to protect oil vessels in Straits of Hormuz has halted the rise in prices, leading to a reversal this morning.
— Dan McTeague (@GasPriceWizard) March 4, 2026
No big changes at the ⛽️⛽️ for Fridayhttps://t.co/rt9FsTqtz2
In a social media post on Wednesday morning, McTeague warned that gasoline could jump another three cents per litre on Thursday, with diesel costs rising even more, by 11 cents, due to the conflict.
On Wednesday morning, a litre of gas was averaging $1.42 in Toronto , which was a few cents above the national average of $1.38 as reported by the Canadian Automobile Association. Canadians for Affordable Energy reported the highest price was $1.71 in Vancouver, and the lowest was $1.26 in Peterborough, Ont.
McTeague told National Post that world oil prices had already been rising on the threat of an attack on Iran. “There had been a war premium already factored into trades going back a couple of weeks in February,” he said. “And I think that’s probably why the response, although shocking, is somewhat muted.”
He had a warning, however, to anyone who thinks that not driving a car will shield them from the shock. “It’s going to meander into pretty much every other aspect of the economy, thanks to a weak Canadian dollar and no ability to provide as a swing supplier of petroleum products and oil to the rest of the world.”
The Canadian dollar has been on a slow decline against the U.S. greenback for the past five years, and now sits at about 73 cents.
“We price all of our commodities in U.S. dollars whether they’re made here or not,” McTeague said.
He also noted that “we butt up against the switch over from winter to summer gasoline. That does increase prices, about eight cents a lire. People also tend to drive more as warmer weather opens up the possibility for longer, easier road trips.
Meanwhile, the cost of diesel fuel in a long-haul transport truck with a thousand-litre tank could rise by $60 every time it’s filled up, said McTeague.
“If this goes on for another week, you will be getting everyone who uses diesel fuel, from aviation companies to transport companies to deliveries, now adding in a fuel surcharge,” he predicted. “It won’t happen tonight. It probably won’t happen this week, but if this goes on for a few more weeks, and the price continues to escalate, seemingly on a daily basis, that’s one of the potential outcomes is that we see much higher delivery costs.”
He added: “It doesn’t just stop at transportation. We use diesel and energy for mining, we use it for manufacturing, we use it for refining other products. There’s a whole pile of uses for energy, and if the price goes up, then it has to be borne by someone else. Ultimately, it’s a customer holding the bag, and for the fight against inflation? Well, it’s just taken a severe hit.”
McTeague once worked as a public relations specialist with Toyota Canada, and was also a long-time member of Parliament (1993 to 2011) and Parliamentary Secretary to the Minister of Foreign Affairs. “Putting on my old cap,” he said, “these things don’t go away quickly. Last time we got involved in the Middle East … it was more protracted and prolonged.”
That said, he’s not willing to predict specific prices more than a couple of days out; there’s just too much uncertainty. Even Wednesday morning he noted on X: “(Donald) Trump’s pledge to protect oil vessels in Straits of Hormuz has halted the rise in prices, leading to a reversal this morning.”
“Anybody who can predict longer than that, obviously I’d give them credit and ask them to pick out next week’s lottery numbers, because there’s no way you can go further than that. No one really knows.”
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