Brent crude is once again brushing against the US$100-a-barrel line, and this time the trigger is a fresh escalation around some of the world’s most important energy infrastructure. Houthi attacks on southern Saudi Arabia disrupted operations at energy sites just as shipping through the Strait of Hormuz remained constrained by the wider U.S.-Iran conflict. The market reaction has been swift: oil benchmarks jumped to multi-week highs, while Canadian gasoline prices were already climbing sharply.
For Canadian households, the timing is especially uncomfortable. The national average gasoline price has moved to its highest level in a month, and elevated refining margins are amplifying the effect of expensive crude. Ottawa has extended its fuel-tax relief, but that cushion may only partly offset another global energy shock if Gulf disruptions persist.
Oil Is Back Within Touching Distance of US$100
Brent crude climbed as high as US$99.46 a barrel on September 8, its strongest level since late July, while West Texas Intermediate reached about US$94.73, its highest since early June. The move matters because it puts the benchmark within cents of a psychologically important threshold that traders, refiners and consumers watch. Prices had already risen before the latest Saudi attacks, reflecting concern that the Middle East conflict could keep oil markets tight.
The latest increase is not simply speculative fear. Tanker traffic through Hormuz remains below normal, refined-fuel markets are strained and several banks have lifted forecasts as the conflict drags on. Still, US$100 is not a magic switch. Canadian gasoline prices respond to crude costs, refining margins, exchange rates, taxes and local wholesale conditions. What the threshold does signal is that another layer of pressure is building just as motorists are already paying more than a month ago.
Saudi Energy Sites Become the Latest Flashpoint
The immediate catalyst was a coordinated Houthi attack on southern Saudi Arabia that struck civilian and economic sites in Abha, Khamis Mushait, Jazan and Najran. Saudi authorities said 73 people were injured, including women and children, while fires broke out and operations were temporarily halted at some energy facilities. The Jazan area matters to oil markets because it includes a Saudi Aramco refining complex capable of processing about 400,000 barrels a day.
Even a temporary shutdown can move prices when traders are worried about vulnerable infrastructure. The market is not only calculating barrels lost today; it is pricing the possibility of repeated attacks on refineries, storage sites, pipelines and export corridors. That explains why crude can jump before the full extent of physical damage is known. For Canada, the relevance is indirect but immediate: globally traded crude and refined products become more expensive when buyers compete for fewer secure supplies.
Hormuz Remains the Bigger Risk Behind the Headlines
The Saudi strikes landed in a market unsettled by reduced shipping through the Strait of Hormuz, a Gulf passage carrying a major share of global petroleum exports. Kpler data cited by Reuters showed only seven commodity vessels transited the strait on Monday, down from eight the day before, although counts can understate activity because some vessels travel with tracking systems disabled. Iran has threatened retaliation against further U.S. attacks and warned that Gulf energy infrastructure remains vulnerable.
That makes Hormuz more important than any single refinery. When shipping slows, exporters face delays, tanker insurance becomes more expensive and buyers seek alternative cargoes. Some Gulf producers can reroute output, but replacement capacity is limited. The effect reaches Canadian consumers through world pricing rather than direct dependence on Saudi gasoline. A barrel diverted in Asia or Europe can still change what a North American refiner must pay for crude or replacement fuel.
Why Crude Has Not Broken Far Above US$100
For all the disruption, the oil market still has shock absorbers. Reuters reported that Middle Eastern crude shipments were running at about 11 million barrels a day versus roughly 18 million before the war, yet substantial volumes continue to move. Producers are using alternative routes, while non-OPEC supply from countries including Canada, the United States and Guyana is helping offset some lost Gulf barrels. China’s large crude inventories and softer demand growth are another brake on prices.
Those counterweights explain why Brent has approached US$100 without decisively breaking higher. The market is tight, but not yet starved of oil. That balance could change quickly if infrastructure damage expands or tanker traffic deteriorates. It could also move the other way if shipping normalizes or diplomacy improves. For Canadian drivers, that uncertainty means pump prices could remain unusually volatile even if crude never reaches the dramatic levels seen earlier in 2026 again.
Canadian Gasoline Has Already Jumped Sharply
Canadian motorists are not waiting for Brent to cross US$100 before feeling the squeeze. CAA’s national tracker, updated early September 8, put the average price of regular gasoline at 179.9 cents per litre. That compared with 176.7 cents the previous day, 171.2 cents a week earlier and 164.0 cents a month earlier. The tracker showed September 8 as the highest national average of the past month, though still below the 190.4-cent peak recorded in May.
For a 50-litre fill, 179.9 cents works out to about $89.95. At the month-ago average, the same fill would have cost about $82, a difference of nearly $8 before any further oil-driven increase. That is small enough to disappear inside a grocery bill but large enough to matter when repeated every week or two. Commuters, tradespeople and rural households with fewer transportation alternatives feel those changes fastest, particularly when fuel costs are already elevated today.
Ottawa’s Tax Relief Is Preventing an Even Bigger Hit
The federal government has extended suspension of the fuel excise tax, important on a day when the original relief was scheduled to end. Ottawa says zero rate will remain in place through January 31, 2027. From February through March, half the normal rate is scheduled to return before full rate resumes in April. The regular federal excise tax is 10 cents per litre on gasoline and four cents on diesel.
The extension does not stop market prices from rising, but it removes a fixed cost that otherwise would have returned on top of the crude rally. The government estimates the extension will add about $2.9 billion in fiscal relief, bringing total estimated 2026-27 fuel-tax relief to $5.3 billion. That cushion matters, yet it cannot insulate households from a prolonged shock. If wholesale gasoline rises by more than the tax savings, motorists can still see higher pump prices despite the suspension.
Why Prices Will Still Look Different Across Canada
A national average can hide local differences. Natural Resources Canada notes that gasoline prices reflect more than crude oil: refining and marketing margins, transportation costs, inventories, local supply conditions, competition and taxes all matter. Remote stations often face higher delivery costs, while smaller communities may sell fewer litres and need wider retail margins. Provincial and municipal fuel taxes add another layer of variation from one city to another.
That means an identical global oil shock will not produce an identical pump-price increase everywhere. A refinery outage in one region can push local wholesale prices higher even when another province sees only a modest change. Competition can produce short-lived gaps between neighbouring cities. For households, the national trend is more useful as a direction than a promise of a specific local price. Brent near US$100 raises pressure broadly, but roadside signs still depend on each region’s supply chain and tax structure.
Canada Is an Oil Winner and a Fuel Consumer at the Same Time
Higher crude prices create a Canadian contradiction. The country is a producer and exporter, so stronger oil prices can increase producer revenues, support activity in energy-producing provinces and improve export receipts. The Canada Energy Regulator says Canadian crude and equivalent production averaged a record 5.35 million barrels a day in 2025. Canada also exported 4.3 million barrels a day of crude that year, with 90% going to the United States.
Those figures explain why expensive oil is not negative for the national economy. Alberta and other producing regions can benefit even while households pay more for gasoline, diesel and goods moved by truck. The gains are unevenly distributed: a producer receiving higher prices is in a different position from a commuter with a long drive or a small business running vans. Canada can be energy-rich and still experience a consumer fuel shock because pump prices remain tied to competitive markets.
Gasoline Is Again Complicating Canada’s Inflation Fight
The Bank of Canada was worried about energy prices before the latest Saudi attacks. On September 2, it held the policy rate at 2.25% and said consumer-price inflation had been hovering around 3%, mainly because of persistently high gasoline prices. Excluding gasoline, inflation was 2.2% in July and core measures remained close to 2%, suggesting the energy shock had not yet become broadly embedded in other prices.
That distinction matters. Central banks generally look through a temporary jump in fuel prices because higher interest rates cannot reopen a shipping lane or repair a refinery. The risk grows when expensive energy lasts long enough to feed into freight, air travel, food distribution and business costs. The Bank has warned that prolonged high oil prices and refinery margins increase the chance of spillovers. If Brent stays near US$100 for months rather than days, the question becomes whether inflation remains stubbornly above target.
The Next Move Depends on Shipping, Not the Round Number
The question is not whether Brent prints US$100 for a few minutes; it is whether Gulf oil can move safely and consistently. Goldman Sachs has raised baseline forecasts because it expects Middle East shipping disruptions to persist, while outlining a severe scenario in which Brent could exceed US$120 if Gulf production remains far below pre-war levels. That is an upside-risk scenario, not the bank’s central forecast, and it underscores how wide the range of outcomes remains.
For Canadian drivers, the best signal to watch is the physical market: tanker traffic through Hormuz, refinery operations, refined-product inventories and diplomatic de-escalation. If those improve, the geopolitical premium can retreat quickly. If attacks spread or shipping deteriorates, wholesalers may have to pay more for crude and finished fuel. With Canadian gasoline near 180 cents a litre nationally, even a smaller second wave would land on budgets that have already absorbed a substantial increase.
