Okotoks pays 11 cents more per litre than Calgary — analyst explains the gap

Gas prices in Okotoks routinely run 10 cents per litre or more above Calgary, and market competition — not crude oil prices — is the reason, according to Patrick De Haan, head of petroleum analysis for GasBuddy.

On October 15, regular gas in Okotoks averaged around $1.70 per litre, compared to about $1.59 in Calgary. High River, slightly closer to Calgary's market, fell between them at around $1.64.

"In a city like Calgary, where there is an abundance of stations all competing for the same group of consumers, then stations are more likely to undercut their competition in order to get a leg up," De Haan said. In smaller markets like Okotoks, stations can set prices higher if consumers are willing to pay — even when cheaper gas sits 15 minutes away.

"If there is no one aggressive on lowering prices — and everyone is looking around waiting for the first person to act — unfortunately that means there is less competition," De Haan said.

Wide price gaps between nearby communities are common across Canada and the U.S., he noted. "Stations apparently don't feel the need to compete by lowering prices at the same pace in every city. There's not always rules or rhyme or reason to why one community is more expensive than another."

For consumers, the options are limited. "Unfortunately, motorists can't do a whole lot aside from patronizing a station that may be somewhere else that's a little bit more competitive," De Haan said.

Current elevated prices across Canada stem from geopolitical tensions. Wars in Iran and Ukraine have targeted oil refineries and infrastructure, creating an imbalance in global supply. De Haan said meaningful price decreases are unlikely until those conflicts resolve. "There's constant talks about deals, and then no deals, and new attacks," he said.