Canadian economy faces inflationary trend as gas prices soar
, driven in part by the Russian invasion of Ukraine, but compounded by legacies from the pandemic, including lower production capacities and increasing demand from consumers.
The geopolitical struggle half a world away is already affecting Canadians, via prices at the pumps, and may, in the weeks and months ahead, increase the price of consumer goods, although the extent to which this will happen is uncertain. While there are a number of other factors that go into the prices Canadians see at the pump, including costs of refining crude oil and local taxation, the effect between increasing oil prices and increasing gas prices is “pretty direct,” Birn said.
While some analysts have put dollar figures on where prices could go, raising the spectre of gasoline prices eclipsing $2 per litre, Birn said it’s far too early to say with confidence about where prices will go.Article content Philip Cross, a senior fellow at the Macdonald-Laurier Institute, said modelling shows that doubling oil and gas prices — from whatever price to whatever price — will affect prices on items like clothing or food, and lead to increased cost for industry such as manufacturing and mining.
Or, the cost of food, which, while affected by shipping costs, has also been going up in recent years because of the way climate change and weather affects grain production, which in turn affects dairy, and so on.