Why Did Gas Get So Expensive So Fast?

You pulled in to fill up last month and paid $1.30 a litre. You pulled in last week and paid $1.68. Nothing changed in your life. Same car. Same commute. Same city. What are you going to do? Just not fill up? I'm here to help you understand why. It sucks, but it's our reality.

Gas prices across Canada have surged since late February 2026, with Ontario drivers watching prices climb from roughly $1.25–$1.30 up past $1.68 in a matter of weeks. In Vancouver, prices cracked $2.00 a litre. That's not a seasonal blip or a refinery hiccup. It's a chain reaction, and once you see how it works, you'll spot it every time prices spike from here on out.

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What Set It Off

On February 28, 2026, the U.S. and Israel launched a joint military offensive on Iran. Within 48 hours, Iran's Revolutionary Guard warned commercial vessels away from the Strait of Hormuz: a narrow waterway at the mouth of the Persian Gulf, and began targeting oil tankers in the region.

Here's why that matters: roughly 20% of all the oil traded in the world moves through the Strait of Hormuz every single day. It's a chokepoint about 33 kilometres wide at its narrowest point. Over 150 commercial vessels dropped anchor in the Persian Gulf almost immediately, refusing to risk the transit. That decision alone pulled an estimated 15 million barrels per day from global circulation.

You don't have to understand oil markets to understand that. If 20% of the world's supply of anything suddenly disappears from the market, it gets more expensive fast.

The Chain: How a War Becomes a Gas Receipt

This is the part most news coverage skips over. They tell you "oil prices went up because of the Middle East." They don't tell you how that ends up on your receipt. Here's the actual chain.

From conflict to chokepoint to crude benchmark to your receipt, five steps, zero shortcuts.

Step 1: The Strait of Hormuz shuts down. When tanker traffic through the Strait slows or stops, global oil supply drops. Not Canadian supply specifically. Global supply. And because oil is priced globally, a supply drop anywhere affects prices everywhere.

Step 2: Traders price in the worst case. Oil markets don't wait for facts. They price in fear. When the conflict started, analysts noted that crude prices were being "supercharged not by facts but by headlines", traders worldwide betting on how bad it might get. This is called a risk premium: a markup baked into the price before any actual shortage occurs. Brent crude, the international benchmark, surged more than 50% from pre-war levels in the weeks following the first strikes.

Step 3: Canadian gas tracks Brent crude. Here's the part most Canadians don't realize. The gas in your tank is priced off international crude benchmarks, primarily Brent crude, set in London, not off whatever Canadian oil happens to be trading at. When Brent goes up by $13 a barrel, you can expect roughly 8 cents more per litre at the pump. A $33 jump adds about 20 cents per litre. That math is almost mechanical once crude moves.

Step 4: Refinery margins and seasonal factors pile on. Spring is already an expensive time for gas, every year. Refineries run maintenance before the summer driving season, which limits how much gasoline can be produced. Demand also rises as the weather warms. These seasonal factors were already pushing prices before the conflict started, the war landed on top of them.

Step 5: Taxes don't move. The federal excise tax, provincial fuel tax, and carbon levy are flat per-litre amounts. They don't go down when crude goes up. So as crude prices rise, the base taxes stay put and you pay both.

The Alberta Paradox

Here's where it gets genuinely strange, and where the Alberta angle matters.

Alberta sits on the third-largest oil reserves in the world. The oil sands stretch across an area the size of England, producing millions of barrels a day. Suncor, Cenovus, Canadian Natural Resources; these are among the largest energy companies on the continent. By any reasonable measure, Alberta is an oil economy.

So why are Albertans paying $1.68 a litre like everyone else?

The answer comes down to three things: what Alberta produces, where it goes, and how it's priced.

Alberta's crude is called Western Canadian Select (WCS). It's a heavy, sulphur-rich oil extracted from bitumen. Not the light, easy-to-refine crude that benchmarks like Brent or WTI represent. Because WCS requires specialized refineries to process, it typically trades at a discount to global benchmarks, sometimes $10–$15 per barrel lower, occasionally much more. The oil is cheaper to sell, not cheaper for you to buy.

More importantly: Alberta's oil overwhelmingly flows south into the U.S. refinery system, not into Canadian gas tanks. There are very few refineries in Western Canada capable of turning that bitumen into retail gasoline at scale. Your gas station in Calgary buys its fuel the same way a gas station in Toronto does: from refineries that price their product off international benchmarks.

The result: Albertans pay global prices for a product they produce at industrial scale.

Alberta as a producer versus Alberta as a driver. Two completely different economic experiences from the same province.

And here's the twist that really stings. When oil prices spike, like right now, the Alberta government actually benefits. Higher crude prices mean higher royalties, more tax revenue, and a smaller provincial deficit. Premier Smith's office noted the price spike could help the province's fiscal position. So while Albertans the drivers are paying more at every fill-up, Alberta the government is running better numbers.

Same province. Opposite outcome depending on which side of the equation you're on.

What Students Actually Feel at the Pump

The gas price is the obvious one. But if you're on a tight budget, the Iran war is hitting you in at least three places you might not have connected yet.

Groceries are getting more expensive. Diesel prices have climbed more than 30% from pre-war levels. Everything you buy at a grocery store arrived on a truck. Higher diesel means higher shipping costs, which shows up in food prices within weeks. Economists are already forecasting food inflation to climb rather than continue its expected decline.

Flights are getting pricier. Jet fuel is a direct derivative of crude oil. WestJet and Air Canada both confirmed that higher fuel costs are already affecting ticket pricing. If you're planning a summer trip, book sooner rather than later.

Your rideshare costs more too. Every Uber or Lyft driver is eating higher fuel costs. That gets passed to you through surge pricing and fare adjustments. Several ride-share drivers in major Canadian cities have already spoken out about the hit to their margins.

For students who drive, commute, or live on thin margins, this isn't abstract economics. It's $15–$20 more every time you fill up a 50-litre tank, for as long as the conflict persists.

What You Can Actually Do

The chain runs from geopolitics to commodity markets to your receipt. You can't change the first two. But you can stop paying the ignorance tax on the third.

Use GasBuddy. Prices vary significantly even within the same city and can shift by 5–10 cents per litre between morning and evening on certain days. Checking before you fill can save real money over a week.

Fill mid-week. Gas prices tend to rise heading into weekends when demand picks up. Tuesday and Wednesday are historically cheaper days to fill in most Canadian cities.

Fill earlier in the day. Gasoline is denser in cooler temperatures, you technically get slightly more energy per litre at 7am than at 2pm. Minor, but it's free 😂.

Consolidate trips. Cold starts burn more fuel. If you can combine your errands into one longer trip rather than three short ones, you'll spend less per kilometre.

None of this fixes a geopolitically-driven price spike. But it takes the edge off while you wait for the situation to settle.

The Bigger Point

The Iran war won't last forever. Strait of Hormuz disruptions historically resolve, in weeks or months, not years. When they do, prices come back down.

But the next spike will follow the same chain. It might be a different chokepoint, a different conflict, a different producer country. The mechanism is always the same: a disruption somewhere in the global supply chain, a risk premium priced in immediately by traders, a benchmark price increase that flows through to every gas station in Canada within days.

Understanding that chain doesn't lower the price at the pump today. But it means you'll never be surprised by a spike again, and you'll know exactly where to look to understand how long it's likely to last.

The world is interconnected in ways that show up, eventually, on your receipts. Gas prices are just one of the most visible.

TL;DR

• Gas prices in Canada jumped ~40 cents/litre since late February 2026 because of the U.S.-Israel war on Iran
• The Strait of Hormuz, a chokepoint carrying 20% of the world's oil, was effectively shut down, pulling 15 million barrels/day from global circulation
• Oil is priced globally off benchmarks like Brent crude: a $33/barrel increase adds ~20 cents/litre at your pump, mechanically
• Your gas station prices off international benchmarks regardless of where the oil is produced — including Alberta
• Alberta is the contradiction: the government earns more royalties when prices spike, but Alberta drivers pay the same high prices as everyone else
• Beyond gas, the spike is raising grocery prices (diesel-dependent supply chains), airfare, and rideshare costs
• Use GasBuddy, fill mid-week, and consolidate trips to take the edge off while the situation plays out
• The mechanism behind every price spike is the same. Now you know how to read it.

Disclaimer:

This article is for educational purposes only and does not constitute financial advice. Gas price figures referenced reflect reported Canadian averages from news sources as of March 2026 and may vary by region. Verify current prices at your local pump or via GasBuddy.