Gas prices in the Greater Toronto Area are once again on the rise, just weeks after a brief dip offered drivers temporary relief at the pumps. On May 1, prices climbed to $1.36.9 per litre at many stations across the GTA—up nearly 20 cents from the post-announcement low of $1.17.6 on April 9. That short-lived decline followed Prime Minister Mark Carney’s move to eliminate the federal consumer carbon tax during the federal election campaign.
While the removal of the tax initially brought some financial ease to motorists, energy expert Dan McTeague—president of Canadians for Affordable Energy and a former Liberal MP—warned that the price break would not last. He predicted a sharp increase once the government’s promised industrial carbon pricing system takes effect. Now, he says, that upward trend has already begun.
McTeague believes prices could soon hit $1.60 per litre or higher, especially as market forces adjust to the transition and seasonal fuel demand intensifies. Though the new industrial tax framework has yet to be formally implemented, the anticipation alone is already influencing prices.
Prime Minister Carney, a staunch advocate for net-zero emissions and former UN climate envoy, has been clear that reducing fossil fuel reliance remains a top government priority. His administration plans to replace the consumer carbon tax with a system that shifts the burden to polluting industries—but McTeague argues that the costs will ultimately still fall on everyday Canadians.
“Whether it’s a direct tax at the pump or a price embedded in the supply chain,” McTeague said, “consumers end up footing the bill.”
He also voiced concerns about the broader economic ripple effects, warning that increased fuel prices could weaken the Canadian dollar, reduce energy exports, and potentially trigger a recession.
For now, drivers across the GTA are feeling the early effects, and as McTeague put it, the brief “gas price holiday” is officially over.