Diesel Near $3 a Litre: Why It Costs More Than Gas

Why is diesel close to $3 a litre in Canada? World supply is tight. Wars in Ukraine and the Middle East cut how much diesel gets made and shipped. Buyers in other countries now want the same fuel we use. VOCM says diesel is near $3 in parts of Newfoundland and Labrador. Gas prices, on the other hand, have dropped.

Key takeaways

• VOCM reported on October 26 that diesel went up about 7 cents a litre over the weekend in Newfoundland and Labrador.
• VOCM says diesel costs about $2.98 in Churchill Falls and about $2.85 in the St. John's metro area.
• GasBuddy says the national diesel average was 258.3 cents a litre on October 19. Regular gas was 172.88 cents.
• In Ontario's own survey for October 19, diesel was 261.6 cents. Regular gas was 174.7 cents.
• GasBuddy says diesel set a record of $2.66 a litre on September 22.
• Experts say the cause is world supply, not Canada's refineries.
• Smooth driving, the right tire pressure and less idling all cut fuel use, says NRCan.

What is going on with diesel prices

I have watched fuel prices for a long time. It is rare to see gas fall while diesel climbs. That is what is happening now.

VOCM reported on October 26 that diesel went up about 7 cents a litre on the weekend in Newfoundland and Labrador. It costs about $2.95 in parts of the south coast, such as Harbour Breton. It is about $2.98 in Churchill Falls and about $2.85 in the St. John's metro area. VOCM says diesel is now the most costly of all the fuels for driving and heating.

It is not just one province. GasBuddy said on October 19 that the national diesel average went up 3 cents in a week to 258.3 cents a litre. Over the same week, regular gas fell 4.1 cents to 172.88 cents. Patrick De Haan of GasBuddy said gas went down in every province, while "diesel told a different story."

Ontario's weekly fuel survey shows the same gap. On October 19, diesel in Ontario was 261.6 cents a litre on average. Regular gas was 174.7 cents. That is close to 87 cents more for each litre of diesel.

Why diesel costs so much more than gas

The short answer is that the world does not have enough diesel right now.

Scotiabank says diesel prices have climbed far more than crude oil would explain. It points to two things. Fuel is hard to ship through the Middle East after the Iran war. And the war in Ukraine has shut down some of Russia's refineries.

De Haan told CBC News that Canada's own refineries are not the problem. He said buyers in Europe, Turkey, China and India are now looking for diesel. More and more, they turn to the same refineries that supply Canada. That pushes up the price for all of us.

Is it going to get better soon? Nobody knows. In October, the G7 said it would release 100 million barrels of diesel from reserves over four months, the Western Producer reported. De Haan said it may not help as much as people hope. He also said prices could go higher if the wars get worse.

Who this affects

If you drive a diesel pickup, van or SUV, you feel this at every fill. Here is a simple example using Ontario's October 19 average. An 80 litre fill of diesel at 261.6 cents costs about $209. The same 80 litres of regular gas at 174.7 cents costs about $140. That is about $69 more for one fill.

You may pay more even if you do not drive a diesel. Aaron Dolyniuk of the Manitoba Trucking Association told CBC News that high diesel costs end up passed on to shoppers. He said food, goods and produce all move by truck at some point. Scotiabank also says high diesel prices can push up prices for things like food over time.

How to save on diesel

You cannot control the price at the pump. You can control how much you burn. NRCan says these habits can cut fuel use by as much as 25%:

• Speed up gently. NRCan says to take about 5 seconds to reach 20 km/h from a stop.
• Keep a steady speed. Speeding up and slowing down between 75 and 85 km/h can raise fuel use by 20%, NRCan says. Use cruise control on the highway when it is safe.
• Slow down on the highway. At 120 km/h, a vehicle uses about 20% more fuel than at 100 km/h.
• Coast to a stop. Look ahead and lift off the pedal early instead of braking hard.
• Check tire pressure each month. Tires 8 psi too low can raise fuel use by up to 4%. Cold weather lowers tire pressure, so check more often now.
• Do not idle. Turn off the engine if you stop for more than 60 seconds, unless you are in traffic. NRCan says 10 minutes of idling burns 0.25 to 0.5 litres of fuel.

My own tip from years in the shop is to shop around. Diesel prices can be very different from one city to the next. Ontario and the Atlantic provinces post their prices each week, so check before a long trip.

For a full way to work out what your truck costs to run, see our guide to fuel cost per 100 km. Cold weather also raises fuel use, so read our tips to get your car ready for the cold.

Photo: Raysonho, CC0, via Wikimedia Commons. A diesel pump at an Esso station. File photo.

What about taxes?

Taxes are part of the price, but the experts quoted here blame world supply for the jump in diesel. To see what is happening with the federal fuel tax, read our story on Budget 2026 and the gas tax. If you live in Quebec, see our weekly look at gas prices in Quebec.

My take

Diesel drivers should plan for high prices for a while. The experts I have quoted do not see a clear end to this. Drive smooth, keep your tires full and do not idle. Those small habits add up when every litre costs close to $3.

FAQ

Why is diesel more expensive than gas right now?

World diesel supply is tight. Scotiabank points to shipping problems in the Middle East and damage to Russian refineries. Buyers in other countries now want diesel from the same refineries that supply Canada.

How much is diesel in Canada this week?

GasBuddy said the national average was 258.3 cents a litre on October 19. VOCM says diesel is about $2.85 to $2.98 in parts of Newfoundland and Labrador.

Are Canada's refineries the problem?

No. GasBuddy's Patrick De Haan told CBC News that Canada is pretty much self-sufficient at refining. The problem is world demand for the same fuel.

Will diesel prices go down soon?

No one can say. The G7 plans to release diesel from reserves, but De Haan said prices could go higher if the wars get worse.

How can I use less diesel?

NRCan says to speed up gently, keep a steady speed, check your tires each month and turn the engine off if you stop for more than 60 seconds.