Ontario gas prices are plummeting with the federal consumer carbon price now scrapped.
Tuesday marked the end of Ottawa’s consumer fuel charge after Mark Carney signed an order-in-council to remove it when he was sworn in as prime minister last month. The industrial carbon price remains in place.
With the policy now in effect, gas prices are expected to tumble anywhere between 17 to 20 cents a litre in the province, analysts said.
Roger McKnight, chief petroleum analyst with En-Pro International, told Global News the price drop for diesel will be even higher, with that cost expected to plummet by 21.4 cents per litre.
However, McKnight said prices may fluctuate given other factors, including HST being built into the price at the pump.
Patrick De Haan, head of petroleum analysis at GasBuddy.com, echoed that sentiment.
“While this is a fairly big lever that will help prices go down significantly … the underlying cost of oil is going up,” he told Global News.
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“It may be more in the realm of a 15 cent per litre drop that most Canadians end up seeing.”
As of 4 a.m. Tuesday, the average price of gas in Canada was $1.51.3 per litre, CAA’s website shows. In Ontario, Gasbuddy users were reporting prices of $1.26.9 and $1.36.6 at stations across the province.
The consumer carbon price was a key policy under former prime minister Justin Trudeau’s government. It effectively put a price on pollution to get people to use fewer fossil fuels.
Over time, it faced criticism and pushback at both the federal and provincial levels, especially as inflation set hold in Canada. Ottawa encouraged provinces to implement their own carbon price, but those that didn’t — such as Ontario — were subject to Ottawa’s rate.
The Canada Carbon Rebate, which saw quarterly tax-free payments delivered to eligible Canadians, was used to try to offset the increases in prices paid by consumers, with Ottawa saying about 80 per cent of Canadians were getting back more than what they were paying.
With Carney bringing an end to the consumer carbon price, the rebate will also end, with the final payment set to be made to Canadians’ bank accounts in April.
Quebec, which has had a cap-and-trade system in place since 2013, is now the last province in Canada that hasn’t dropped carbon pricing.
Some provinces are preparing for higher demand due to the changeover of gasoline as summer arrives.
Despite this, De Haan said it won’t offset what people will see saved at the pump, which means “lower prices throughout the rest of the year.”
— With files from Sean Previl
© 2025 Global News, a division of Corus Entertainment Inc.
