Time to fill up your car? Analysts recommend it's best done before Wednesday

As Hurricane Harvey hovers off the coast of Texas, some analysts speculate the storm could cause a sharp increase in gas prices.

New Brunswick's Energy and Utilities Board, an "independent quasi-judicial board" charged with regulating certain utilities, said it will activate its interrupter clause if, by the end of Monday, it finds a six cent increase in the price of gas compared to Friday.

The clause allows New Brunswick gas retailers to raise the maximum they can sell gas for, if the board discovers a sudden change in the U.S. market caused by dramatic events, such as the floods in Texas.

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David Young, spokesperson for the board, said it's illegal for him to reveal whether the clause will be activated.

He also said hurricanes aren't the best indicators for predicting if such a change is imminent.

"There have been hurricanes that don't result in a price change," he said. "That's not necessarily an indicator."

Ike and Katrina suggest otherwise

But, as CBC gas guru Robert Jones tweeted out early Monday,  Hurricane Ike "caused a 13 cent price spike in New Brunswick in 2008 after hitting Texas. Harvey is worse."

So far, the Category 3 storm has forced thousands from their homes and to higher ground in Texas. It also closed a number of refineries, including many of the world's largest natural resources companies.

Jason Parent of the petroleum consulting company Kent Group Ltd., agreed that it's too early to know how much prices might rise.

But when Hurricane Katrina hit the Gulf Coast in 2005, Eastern Canada saw an increase to gas prices between 15 and 20 cents, he said.

"It's in the early stages, but if I were to put money on it I'd say, 'yeah, it's probably going to get triggered,'" he said of the interrupter clause.

According to several other analysts, people on the West Coast can expect to see a hike of three cents, while Ontario and the East Coast should expect a hike of five cents.

"There's not a whole lot of overlap between supply in the Gulf Coast and supply on the West Coast," Parent said.

There's not a whole lot of overlap between supply in the Gulf Coast and supply on the West Coast.- Jason Parent, Kent Group Ltd.

Dan McTeague, senior petroleum analyst with the price comparing website GasBuddy.com, doubted the price increase for New Brunswick will even top four cents in the coming days.

He said people on the East Coast may be looking at 2.3 cents more per litre "at this point, if nothing changes."

But all that could change if more refineries shut down, he added.

"I can't tell what the market will do tomorrow," he said.

Depends on the market

Young said the board will raise the maximum price based on sudden changes at the stock market in New York.

He added that most retailers buy gas on a daily basis.

In the case of a sudden or dramatic increase, gas stations and wholesalers may then have to sell their gas for less than what they bought it for, he said.

"They'd be losing money on every litre that they're selling," said Young.

But if the market falls dramatically, the board can also artificially lower prices to the benefit of the consumer.

While the board will know whether the clause is activating by Monday evening, New Brunswickers won't know until 12 a.m. on Wednesday, when the prices change.

But even if New Brunswick sees an increase in price, it should go down again once the extent of the damage is known and once refineries and pipelines start back up again.