Fallout from Iran war reaching producers in Southern Alberta

By Trevor Busch
Sunny South News
editor@tabertimes.com

With Iran still exerting a stranglehold on oil shipping through the Strait of Hormuz, prices at the pump remain high throughout North America.

Taber-Warner MLA Grant Hunter says Alberta’s fuel tax relief program adjusts the gas tax quarterly based on the average price of West Texas Intermediate (WTI) crude oil. The full 13 cents per litre tax is suspended when oil averages $90 U.S. or more, with phased tax rates kicking in if oil drops below that threshold. 

“We already have a strategy for relief when it comes to gas, once it is consistently above the $85 per barrel – WTI – then we have the ability, there will be some (relief) that’s provided to Albertans. So stay tuned on that,” said Hunter. “It has to hit that price, maintain that price for a certain amount of time. That formula is clearly articulated on our website.”

One of the myriad impacts of high diesel and gas prices is the effect on the price of fertilizer, a critical input for farmers in southern Alberta.

“When it comes to fertilizer, the reality is that the Strait of Hormuz, there’s a lot of crude oil through that strait. And so with the Iran war, this is certainly going to cause some pressure on the fertilizer price. So we’ve got to keep an eye on that,” said Hunter. “I know that I’ve had some producers that have contacted me and said that they are concerned with a couple of the fertilizer companies in our area that were going to be shutting down during the spring, and they’d wanted them to hold off on that. And so we had the ag minister reach out to them and ask them to hold off on that so it didn’t exacerbate the problem.”