ANALYSIS: $1.80 per liter in Quebec — why you’re paying for the war in the Middle East every time you fill up

The cost of crude oil is only part of the bill

A liter of gasoline in Quebec is like a Russian nesting doll of taxes. There’s the cost of crude oil, of course—the one that skyrockets when missiles fly in the Middle East. But there’s also the federal excise tax, Quebec’s fuel tax, the carbon tax, the QST, the GST, and refining and distribution margins. In total, taxes account for between 40 and 50 cents per liter in Quebec. That’s more than in most Canadian provinces. And it’s a political choice, not a geological inevitability.

The Girard budget includes nothing

Le Journal de Québec reported this week that the Girard budget contains no measures to offset the rise in gas prices. No temporary reduction in the provincial tax. No energy rebate. No targeted reduction for remote regions where a car isn’t a luxury but an absolute necessity. The message is crystal clear: figure it out for yourselves. And yet, in Abitibi, in the Gaspé Peninsula, and on the North Shore, there’s no subway. There’s no REM. There’s a pickup truck, a road, and a price that’s skyrocketing.

Three weeks of conflict, months of fallout

The conflict that triggered this surge began three weeks ago. Over the past three weeks, oil markets have priced in the risk of regional escalation, a blockade of the Strait of Hormuz, and massive disruption to supply routes. Crude oil prices have soared. Refineries have adjusted their margins. Retailers have passed on the costs—with remarkable eagerness when prices rise, and equally remarkable slowness when they fall, as always. This is the well-oiled machinery of oil market asymmetry: prices shoot up like an elevator and come back down the stairs.

Trump Is Trying to Put Out the Fire with Gasoline

In Washington, Donald Trump is seeking to mitigate the war’s impact on oil prices. How? By considering lifting U.S. sanctions on Iranian oil—the very same Iranian oil that his administration imposed sanctions on with great fanfare a few years ago. The irony is so thick you could refine it. The president who tore up the Iran nuclear deal is now considering turning on Tehran’s tap to keep American gas stations running. Oil geopolitics has never had a memory, only interests.

A $16 difference between Montreal and Toronto — per full tank

Gas in Ontario costs 166.0 cents per liter. In Quebec, it’s 179.8 cents. That’s a difference of nearly 14 cents between two neighboring provinces, two intertwined economies, and two populations that buy largely the same cars and travel comparable distances. The explanation doesn’t lie in the price per barrel. It lies in tax policies, the distribution structure, the number of refineries, and competition—or the lack thereof—among retailers.

A price war that benefits no one

This week, Le Journal de Québec reported on a gas price war in Quebec, with variations of up to 23 cents between two stations sometimes just a few kilometers apart. This isn’t healthy competition. It’s a symptom of an opaque, concentrated, and poorly regulated market. When the price can vary by 23 cents from one street to the next in the same city, it’s not the global market that’s dictating prices—it’s local arbitrariness. And consumers, for their part, are driving around to different gas stations with their phones and the GasBuddy app, like bargain hunters at a flea market.

Vancouver is paying the price for its climate goals

193.9 cents per liter. British Columbia is by far the most expensive province in the country. It was before the crisis, and it will remain so afterward. Why? Because it has piled on the highest carbon taxes in the country, reduced its refining capacity, and bet big on the energy transition. The result is a real-world experiment showing what happens when you aggressively tax carbon without offering a credible transportation alternative to millions of commuters. Quebec is watching Vancouver and should see its own future reflected there in five years.

Electrification as the Only Way Out

TVA Nouvelles posed the question this week: Will the rise in gas prices be “the calm before the storm for electric vehicle sales”? The logic is undeniable. At $1.80 per liter, a driver who travels 20,000 km per year spends about $3,600 on gas with a conventional vehicle. The same distance in an electric vehicle costs about $600 in electricity in Quebec. The difference—$3,000 per year—covers a significant portion of the monthly payment on an EV. And yet, electric vehicle sales in Quebec are plateauing. The initial purchase price remains a barrier. Charging stations remain insufficient in rural areas. And old habits die hard.

The Hidden Budget That’s Skyrocketing

Twenty-five dollars more per fill-up. It sounds manageable when you put it that way. But do the math. One fill-up a week adds up to $100 more a month. Two cars per family—the norm in the suburbs and out in the country—that’s $200. Over a year, that’s $2,400. That’s the equivalent of a month’s rent in Trois-Rivières. It’s six weeks’ worth of groceries. It’s the kids’ summer camp. And that’s on top of food inflation, rising mortgage rates, and higher insurance premiums. Every oil crisis is an invisible regressive tax—it hits hardest those with the least financial leeway.

The Geography of Pain

In Montreal, you can take the metro. In Quebec City, there’s the bus system. But in Val-d’Or, Sept-Îles, Gaspé, Rouyn-Noranda? Gas isn’t a consumer choice. It’s a right to access life. Going to work. Going to the hospital. Grocery shopping. Driving the kids to school. In half of Quebec’s territory, there is no alternative to the car. None. And it is precisely in these regions that prices are often even higher than in Montreal, because fuel transportation costs are added to the already inflated price.

It goes up overnight, then comes back down over three months

Every Quebecer has been through this. The price per barrel rises 5% on a Tuesday, and the price at the pump jumps on Wednesday morning. The price per barrel drops 5% on a Thursday, and the price at the pump… stays the same for two weeks. Then it drops by a cent. Then another. This is what economists call price asymmetry—or, more bluntly, what consumers call getting ripped off. Refineries and distributors cite supply delays, futures contracts, and safety margins. And yet, curiously, these delays only seem to apply when prices fall. Never when they rise.

The Energy Board looks the other way

Quebec has a tool—the Régie de l’énergie—that could theoretically regulate fuel prices, enforce transparency on margins, and require justifications for price differences between regions. It does not do so. Quebec’s gasoline market remains one of the least regulated in the country—a paradox in a province that regulates almost everything else, from the price of milk to electricity rates. The price per kilowatt is set to the decimal point, but the price per liter of gasoline is left to fluctuate at the whim of speculators and distributors’ opaque markups.

The worst possible political timing

When gas costs $1.28, the carbon tax is an abstract debate. When it costs $1.80, the carbon tax becomes a concrete scandal. That is the political reality of March 2026. Every cent of carbon tax added per liter is now seen not as an incentive for the transition, but as a punishment imposed on people who have no choice but to drive. The timing is devastating for advocates of carbon pricing—and a windfall for their political opponents.

Mathieu Bock-Côté and the Pendulum’s Swing

The Journal de Montréal columnist wrote this week that “even if Quebec were to go back to the Stone Age, it wouldn’t make a difference to climate change.” The statement is provocative, but it strikes a nerve. Quebec accounts for about 0.16% of global GHG emissions. Even if every Quebecer stopped driving tomorrow, the effect on the global climate would be statistically undetectable. This is the key argument of carbon tax opponents, and it is mathematically correct. What it fails to acknowledge is that this argument applies to each country individually—and that if everyone adopts it, no one will take any action.

Sanctions as a Double-Edged Sword

The Trump administration is considering lifting its own sanctions on Iranian oil. Read that sentence again. America is at war with Iran—or at least engaged in a conflict involving Iran—and at the same time is considering buying back its oil to lower domestic prices. This is realpolitik in its purest form. It’s also an admission that oil sanctions, presented as tools of geopolitical pressure, are in reality instruments of domestic policy that are adjusted according to poll numbers and the price at the pump.

Oil has no morals

The same barrel of crude that funds authoritarian regimes heats homes in the Saguenay region. The same tanker that crosses the Strait of Hormuz under a U.S. military escort supplies the Lévis refinery, which produces the gasoline sold at the local Couche-Tard. The oil supply chain is a constant exercise in collective moral amnesia—and every driver participates in it without a second thought, because they have no choice.

Quebec buys its energy at the highest price and sells it at the lowest price

Herein lies the central paradox of Quebec’s energy sector. Quebec generates hydroelectricity at about 3 cents per kilowatt-hour—among the lowest production costs in the world. It sells it to its residents at regulated rates that are among the lowest in North America. But it imports oil at world market prices, subject to every geopolitical upheaval, every speculation on the futures markets, every strait closure, every missile fired in the Middle East. It’s like owning a gold mine and buying your jewelry at Tiffany’s. Quebec is a clean-energy giant that behaves like a dependent oil dwarf.

Transportation Electrification as a Matter of Sovereignty

Seen from this perspective, the electrification of transportation is not just a climate issue. It is a matter of economic sovereignty. Every electric vehicle that replaces a gasoline-powered vehicle means one less liter of imported oil. It’s one dollar that stays in the Quebec economy instead of flowing to Alberta, Texas, or the Middle East. It means one fewer consumer at the mercy of the next geopolitical conflict. Hydroelectricity is the only energy resource that Quebec fully controls. Not using it on a massive scale for transportation is a questionable strategic choice.

Who Benefits When Gas Prices Skyrocket

Someone is pocketing those extra 42 cents. It’s not the gas station attendant, who earns the same salary as before. It’s not the independent retailer, whose net margin on a liter of gas is measured in fractions of a cent. The winners are elsewhere: crude oil producers, refiners, speculators on the futures markets, and—it must be said—governments, whose ad valorem taxes (calculated as a percentage) automatically increase when prices rise. When the price per liter goes from $1.28 to $1.80, the GST and QST bring in proportionally more revenue without anyone having voted for it.

Quebec’s Silence

The Quebec government could temporarily reduce its fuel tax. Several provinces have done so during previous crises. It has chosen not to. The Girard budget comes without any offsetting measures for gas prices. It’s a defensible fiscal choice—every dollar in tax cuts is a dollar less for public services—but it’s also a political choice that says something about priorities. When your city’s hospital is short on nurses and a liter costs $1.80, you’re being asked to pay for both at the same time.

The Middle East is just the trigger

If the current conflict were to end tomorrow, gas prices would fall again. Slowly, incompletely, with the usual delays—but they would fall. Until the next crisis. And there will be a next crisis. There always is. The question isn’t whether oil prices will rise again. It’s why, crisis after crisis, Quebec still doesn’t have a credible Plan B to protect its most vulnerable citizens from global oil price volatility.

Quebec has the tools—it lacks the will

Let’s summarize. Quebec has the largest per capita hydroelectric capacity in North America. It has a public transit system in its major cities. It has access to an increasingly affordable range of electric vehicles. It has the technical capacity to electrify its transportation system on a massive scale. And yet, in March 2026, every upheaval in the Middle East still translates into direct financial pain for 8 million Quebecers. This is not inevitable. It is a failure of planning that has been repeating itself for forty years.

What the Gas Pump Doesn’t Tell You

$1.80 per liter. That’s the price on the sign. The real price lies elsewhere. It’s in the billions of dollars that leave Quebec’s economy every year to buy foreign oil. It’s in the healthcare costs linked to air pollution. It’s in the geopolitical dependence that turns every distant conflict into a domestic crisis. It’s in the hours spent in traffic by commuters who have no other option. A liter of gas at $1.80 is an accounting lie. Its real cost to Quebec society is probably double that.

The bill no one presents

When a Quebecer fills up their tank in March 2026, they pay for crude oil, taxes, markups, and transportation. But they also pay—without realizing it—for forty years of political choices that have perpetuated the oil dependency of a province that had everything it needed to break free from it. Every government since 1980 has talked about an energy transition in transportation. Every government has put off the massive investments needed. And every time oil was cheap, the sense of urgency disappeared—until the next shock. This one.

When Gas Prices Make or Break Governments

No economic indicator is as visceral as the price displayed at the gas station. Inflation is a concept. GDP is an abstraction. The benchmark interest rate is a number that most people don’t understand. But $1.80 in big, bright letters on the Petro-Canada sign—that’s something everyone understands. You see it when you’re driving the kids to school. You feel it when you pull out your credit card. The price of gas is the only economic indicator that stares you in the face twice a week.

March 2026 Will Be Remembered

This March will enter Quebec’s collective memory as one of those moments when geopolitics stops being a news story and becomes a kitchen-table topic. When we realize that the Middle East isn’t far away. That the Strait of Hormuz isn’t an abstract concept. That the decisions made in Washington, Tehran, and Riyadh translate into real dollars, real choices, and real sacrifices for Quebec families who asked nothing of anyone. $1.80 per liter. That’s not a price. It’s a lesson Quebec refuses to learn.

Signed, Jacques PJ Provost