Toronto Gas Prices Expected to Reach Record Highs by Late May or Early June.

The Situation So Far:

A significant disruption in global oil supply—centered in the Strait of Hormuz, which carries roughly 21% of the world’s oil—has caused benchmark crude prices to surge above $120 USD per barrel earlier in 2026. The federal suspension of the fuel excise tax, which took effect on April 23 and reduced gasoline prices by 10¢/L and diesel prices by 4¢/L until September 7, briefly lowered the national average price to 169.1¢/L. However, crude oil prices have since risen again, and the National Resources Canada (NRCan) national average for the week of May 12 has climbed to 192.8¢/L—an increase of about 24¢/L within three weeks, even with the tax holiday in effect.

What to Expect Next:

Energy experts advise Toronto drivers to prepare for significantly higher gas prices, potentially setting a new record by late May or early June.

Dan McTeague, a prominent gas industry analyst, anticipates that gas prices will surpass the previous record of $2.15.9/L set in Toronto on June 11, 2022, following sanctions imposed on Russia after it invaded Ukraine.

To better understand the difference between the situation in 2022 and now in 2026, one can consider the impact on oil supply movement. While sanctions on Russia removed only about 3% of the world’s oil supply, the ongoing war on Iran initiated by the US and Israel affects about 21% of oil transportation.

Given this information, most industry experts predict gas prices will rise by at least 20 to 25 cents per liter from mid-May to the end of June. A conservative estimate suggests prices could reach $2.20/L soon, an all-time high likely to persist for more than a few weeks or months.

The reasoning is straightforward: a single, thoughtless decision taken in the moment can rupture the entire mechanics of a supply chain in the blink of an eye; restoring it is a whole other ball game and can take 10-20 times longer. Thus, even if the crisis in the Strait of Hormuz were resolved immediately, which is unlikely, the time required for supply to meet demand can’t be accurately predicted.

Demand currently exceeds 17 million barrels per day for crude oil and refined products, according to S&P Global Energy reports, marking this as the largest oil supply disruption in history.

Previously, the Strait of Hormuz handled about 21 million barrels per day of oil exports, but due to escalating tensions, only 3 to 4 million barrels have reached global markets via alternative routes, which is insufficient for a world accustomed to a continuous flow of oil.

Change of season has a role to play too:

Spring typically sees a spike in travel, leading to increased fuel demand, as Canadians are eager to travel after a prolonged winter. This surge in demand further strains supply chains, driving up retail prices.

Additionally, the switch to summer-grade gasoline—which is necessary for environmental and performance reasons—increases production costs. These higher refining costs are ultimately passed on to consumers at the pump.

How High Can Gas Prices Go?

Experts are uncertain about how high gas prices might rise in Canada and what could be a breaking point for consumers. Most analysts, including McTeague, find it challenging to predict this point.

“There has to be a price signal that diminishes demand,” McTeague stated. “Basic economics indicates that price corrections happen when prices reach levels that begin to dampen demand, allowing time for supplies to recover. However, given the prolonged supply outage, it’s clear we have not yet reached that point.”

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