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Updated September 16, 2026

Why Are Gas Prices So High in Canada in 2026?

Canada's national average hit 198¢/L in mid-April 2026, briefly fell to a low of 169.1¢/L on April 23 after the federal excise tax suspension took effect, spiked back to nearly 196¢/L by mid-May, eased to 170.5¢/L in early August, and is 177.6¢/L as of September 16, 2026 (CAA).

Short Answer
  • A major disruption to global oil supply — centred on the Strait of Hormuz, a waterway carrying roughly 20% of the world's oil — pushed crude prices sharply higher earlier in 2026, with Brent briefly near US$120 a barrel.
  • The federal fuel excise tax suspension that took effect April 20 (10¢/L off gasoline, 4¢/L off diesel, since extended to January 31, 2027) briefly dropped the national average to 169.1¢/L in late April.
  • Prices eased over summer, then rose again: the CAA national average is 177.6¢/L (September 16, 2026), about 30% above summer 2025.
Major-city regular gasoline snapshot — August 5, 2026 figures for comparison; the national average has since risen to 177.6¢/L (September 16, 2026, CAA). The federal excise tax suspension remains in effect, extended to January 31, 2027
Calgary ~$1.55 Regular · Cheapest of 4
Toronto $1.609 Regular
Montreal $1.829 Regular
Halifax $1.906 Regular · Highest of 4
National avg $1.705 Aug 5, 2026 · CAA

Sources: CAA national average (177.6¢/L, September 16, 2026); major-city averages are the August 5, 2026 snapshot. Federal excise tax holiday (10¢/L gasoline, 4¢/L diesel) began April 20, 2026 and was extended on September 2 to January 31, 2027.

How a Global Oil Supply Disruption Reaches Your Gas Tank

Canadian pump prices track world crude prices (Brent and WTI), which trade in US dollars. Even though Canada is a significant oil producer, Canadian refineries purchase crude at market rates, and those rates are set by global supply and demand.

In early 2026, a major disruption to one of the world's most critical oil shipping routes caused crude oil benchmark prices to spike significantly. The Strait of Hormuz — a narrow waterway between Oman and Iran through which an estimated 20% of globally traded oil flows — was temporarily blocked.

~$118 Brent crude 2026 peak (USD/barrel)
177.6¢/L National average, September 16, 2026 (CAA)
20% Share of global oil that transits the Strait of Hormuz
~25-30% Above summer 2025 pump prices

However, the full impact of an elevated crude price takes several weeks to fully flow through a refinery's cost structure and appear at the pump, which is why retail prices remain elevated even as crude prices ease.

Why Alberta Is Still Cheapest

Alberta's pump prices remain the lowest in Canada for structural reasons unrelated to global events: Alberta carries the lowest fuel taxes in the country (its provincial fuel tax was reinstated at 13¢/L in 2024 and remains in force, but the combined tax load is still the lightest of any province), and the province has direct pipeline access to its own oil production and refinery capacity.

Why BC and Atlantic Canada Are the Most Expensive

British Columbia and the Atlantic provinces carry higher fuel taxes than the Prairies.

Quick answers

The Federal Fuel Excise Tax Suspension — Now in Effect

Now in effect — April 20, 2026, extended to January 31, 2027
  • The federal government suspended the fuel excise tax on gasoline (10¢/L) and diesel (4¢/L) starting April 20, 2026.
  • On September 2, 2026 the government extended the tax holiday to January 31, 2027 (then 5¢/L gasoline and 2¢/L diesel from February 1 to March 31, 2027, full rates from April 1) — every Canadian saves these amounts at the pump until then.
  • Even with the holiday, the national average is 177.6¢/L (September 16, 2026, CAA).

The federal fuel excise tax is a flat per-litre tax applied at the wholesale level across Canada. Its suspension means every Canadian pays 10¢ less per litre of gasoline at the pump from April 20, 2026 through January 31, 2027 (then 5¢ less from February 1 to March 31, 2027). For diesel fuel, the reduction is 4¢/L.

To put this in practical terms for road trip budgets:

It does not affect provincial fuel taxes, carbon pricing, or other provincial fees — only the federal excise tax component.

Planning a fall road trip?

The 10¢/L reduction is already in pump prices. The calculator and the table below use the live daily feed. Use the Northern Stay gas calculator for a personalized province-by-province fuel estimate.

Gas Prices by Province — Full Breakdown

Provincial figures are estimates from Northern Stay’s daily model: the CAA national average plus each province’s typical tax and price spread. Updated September 16, 2026. For a pump-level price, check CAA or GasBuddy for your city.

Province / Territory Regular Gas ($/L) Diesel ($/L) vs. National Avg
Alberta Cheapest$1.56$1.70−$0.21
Saskatchewan$1.66$1.80−$0.11
Manitoba$1.71$1.85−$0.06
New Brunswick$1.76$1.90−$0.01
Nova Scotia$1.79$1.93+$0.02
Ontario$1.81$1.95+$0.04
Prince Edward Island$1.83$1.97+$0.06
Quebec$1.86$2.00+$0.09
Newfoundland & Labrador$1.91$2.05+$0.14
British Columbia$1.96$2.10+$0.19
Yukon$2.16$2.30+$0.39
Northwest Territories$2.31$2.45+$0.54
Nunavut Remote premium$2.61$2.75+$0.84

Sources: CAA national average (daily) and Natural Resources Canada. The table refreshes from the live feed each day.

What to Expect This Fall

September 16, 2026 update
  • The summer easing is over.
  • Fighting in the Iran war resumed in early September and attacks on Middle East oil facilities and tankers pushed Brent crude back into triple digits.
  • Canadian pump prices followed: the CAA national average is 177.6¢/L today, up from 170.5¢/L on August 5.
  • GasBuddy's Patrick De Haan told BNN Bloomberg on September 9 that the usual post-Labour-Day decline and the switch to cheaper winter gasoline may not bring much relief this year.
  • The one piece of good news is the federal fuel tax holiday, which Ottawa extended on September 2 to January 31, 2027.

Taken together, the national average settled near 170¢/L in early August 2026 — within the 170–185¢/L range analysts projected for the summer. It did not hold: with fighting in the Iran war resuming in September, Brent crude moved back above US$100 and the CAA national average climbed to 177.6¢/L by September 16, 2026.

For trip planning purposes

Budget using current prices as a conservative baseline and use the gas calculator for a province-by-province fuel estimate. If prices fall further before your trip, you'll come in under budget.

Gas Price FAQs

A major disruption to global oil supply — specifically, the temporary blocking of the Strait of Hormuz, through which approximately 20% of the world's oil passes — caused crude prices to spike, with Brent briefly near US$120 a barrel earlier in 2026. Canadian pump prices track global crude markets. Prices spiked to nearly 196¢/L in mid-May, eased to 170.5¢/L in early August, and are 177.6¢/L as of September 16, 2026 (CAA). The federal government's 10¢/L fuel excise tax suspension has been extended to January 31, 2027.
The federal fuel excise tax suspension began April 20, 2026 (10¢/L off gasoline, 4¢/L off diesel) and was extended on September 2, 2026 to January 31, 2027, with a half rate from February 1 to March 31, 2027. This applies across all provinces. For a car filling a 60-litre tank, that's $6 savings per fillup. For a road trip covering 5,000 km in a car at 9 L/100km (450 litres total), the saving is approximately $45. Diesel RV owners save 4¢/L on diesel.
Alberta. Calgary and Edmonton are usually the cheapest major cities; the table below shows today's provincial average. Alberta carries the lowest fuel taxes in Canada (its 13¢/L provincial fuel tax, reinstated in 2024, remains in force but the combined tax load is still the country's lightest) and has direct access to domestic oil production and refinery infrastructure.
For a full Trans-Canada drive (Vancouver to Halifax, ~5,900 km) at mid-September 2026 prices around $1.776/L: approximately $943 in fuel for a car at 9 L/100km, or approximately $2,305 for an RV at 22 L/100km. The federal excise tax suspension (extended to January 31, 2027) is already baked into those pump prices.
Canadian pump prices track world crude prices (Brent and WTI). When supply of crude oil is disrupted anywhere in the world, the benchmark price rises, and Canadian refineries — which purchase crude at market rates — pass those costs to consumers at the pump. The lag between a crude price move and its full retail effect is typically 2–4 weeks, which is why pump prices can remain elevated even after crude prices begin to fall.
The federal excise tax suspension (10¢/L off gasoline) has been extended to January 31, 2027. Prices spiked to nearly 196¢/L in mid-May, eased to 170.5¢/L by August 5, then climbed again to 177.6¢/L by September 16, 2026 (CAA) as the Iran war flared up. For now, budget about 180¢/L for regular gasoline and 220¢/L for diesel.

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