High gas prices hampering Canadian economy

CANADA - Rising gas prices is going to cost the average Canadian household over $950, according to a study by CIBC World Markets Inc. released today.

As a result the Canadian economy will be feeling the pinch, to the tune of a whopping $11.02 BILLION CDN (there is 11.6 million households in Canada).

That means the average Canadian household will be spending less money on food, entertainment and other consumer goods... a double whammy effect since the price of food and goods will be going up due to higher transportation costs.

During the previous oil shock, the 40% increase in prices between October 2007 and July 2008 caused only a minor change in gasoline consumption. People NEED gasoline to get to work, its not really an option.

Indeed most people (80%) would rather buy gasoline to get to work than pay their mortgage, the logic being that if that if you can't get to work you certainly can't pay the mortgage anyway.

Thus Canadians will be cutting back on buying new vehicles and parts, and discretionary spending. Higher gas prices causes Canadians to buy more food on sale and to cut back on unnecessary snacks.

Gas prices in Canada are up 23% since September 2010.

Gas prices in the USA are up 32% since September 2010 (the gap is due to the Canadian dollar going up in value 8% during the same time period).

HOW TO SAVE $$$ ON GAS

1. Turn off your car's air conditioning. Or at least turn off the AC a few minutes before you arrive at your destination.

2. Use cruise control on open stretches of road. If your speed remains constant, without the need to accelerate, it can save you about 5% of your gas.

3. Get rid of junk in your trunk and get rid of the ski rack. Every extra lb of weight you remove will save you a chunk of cash / year. Remove excess trash and clean your car regularly.

4. Tighten the gas cap. Evaporating gasoline will hurt your wallet.

5. Don’t fill up until you have less than ¼ of a tank left. A lighter load of gasoline saves more on your fuel economy.

6. Go on a diet. If you lose weight, your car will need less gas.

7. Consider a gas membership. Some gas stations and grocery stores give discounts for being a member. Canadian Tire, Real Canadian Superstore, Costco all offer discounts.

8. Don't idle. If you’re stopped for more than a minute turn off your engine.

9. Keep your car well maintained. Properly inflated tires, oil and air filters changed regularly.

10. Change your commuting strategy. Taking a less direct route might help you bypass the traffic congestion or leaving 15 minutes earlier or later could make a huge difference in traffic flow, and thus save you money by not having to accelerate and brake so much.

11. Combine errands. You can save at least twice the fuel as a longer, multipurpose trip. Avoid unnecessary errands.

12. Walk or ride your bike, especially for shorter distances.

13. Carpool with people at your office or in nearby businesses.

13. Check out Gas Buddy before you fill up. They also have a smart phone app for iPhones, Android and Windows devices so you can check where the cheapest place is to buy gas.