Prepare to pay more at the pumps as Alberta fuel tax returns

Gas prices are set to rise in Alberta next month, with the provincial government fully reinstating its fuel tax following a drop in oil prices.

Finance Minister Nate Horner says the fuel tax for gas and diesel will be 13 cents per litre starting April 1, an increase of four cents.

Under the provincial Fuel Tax Relief Program, the tax can be paused or reinstated partially or in full, depending on oil prices.

Fuel tax rates are adjusted quarterly based on the average price per barrel of the benchmark West Texas Intermediate oil.

Alberta's fuel tax was suspended for all of 2023 and partially reinstated at nine cents per litre of gasoline this January. 

In a statement Thursday, Horner said Albertans will continue to pay some of the lowest fuel prices in the country even after the increased rate takes effect.

"Alberta's government is committed to following through with the rate schedule we laid out for the fuel tax relief program last year. When oil prices go back up, the fuel tax rate will come back down," Horner said. 

The tax rate will drop back down if oil prices hit $80 US a barrel or higher, Horner said. 

Horner said the province will continue to review the fuel tax on a quarterly basis and provide another update before the end of June,

A federal tax increase will also be felt at the pumps this spring. Ottawa's carbon tax is set to climb from around 14 cents to more than 17 cents per litre of gasoline on April 1.