A diesel pump is seen at a gas station in Montreal on April 9, 2026. The Canadian Press/Christopher Katsarov
The Conservative Party is calling on Liberal MPs to support its upcoming motion that would seek further cuts to fuel taxes, which the party says will be tabled in the House of Commons next week.
“Conservatives are calling on Liberal MPs to support our motion to cut diesel taxes, produce more fuel in Canada and save Canadians money,” said an Oct. 3 release from the party.
The Conservative plan calls for eliminating federal taxes on diesel sales until July 1, 2027, ending the industrial carbon price and Clean Fuel Regulations, and closing the diesel price gap with the United States within five years. The release said diesel cost approximately 24 cents more per litre in Canada than the U.S. average and 31 cents more than the world average as of Sept. 28.
“Wars and global turmoil affect fuel prices everywhere,” the statement said. “They do not explain away the extra cost Canadians pay. The Liberals cannot control every event overseas, but they can cut the taxes and remove the barriers driving up fuel costs here at home.”
The plan would also create emergency permitting for diesel refineries and storage facilities, allow businesses to deduct 100 percent of their investments in diesel production and distribution in the first year, and establish a strategic refined petroleum reserve.
Canada is the only G7 nation that does not maintain a government-held strategic petroleum reserve because its status as a net energy exporter exempts it from International Energy Agency (IEA) 90-day import reserve mandates.
The federal government suspended the federal fuel excise tax on gasoline, diesel and aviation fuel across Canada from April 20 to Sept. 7. On Sept. 2, Ottawa announced that the suspension would be extended until Jan. 31, 2027, followed by a 50 percent reduction in the regular rate from Feb. 1 to March 31, 2027, before the full rates resume April 1.
The measure was initially introduced in response to higher energy prices stemming from the U.S.-Iran conflict, which disrupted energy markets and led to restrictions on shipping through the Strait of Hormuz, a major global energy transit route. The waterway normally carries roughly one-fifth of global oil and liquefied natural gas shipments. The conflict, which began in late February, initially pushed oil prices sharply higher.
Oil prices later declined as concerns about supply disruptions eased at points, although uncertainty over energy supplies has continued to put pressure on prices. West Texas Intermediate crude traded around US$90 a barrel on Oct. 2.
The Conservatives had been calling for the federal government to extend its fuel-tax holiday. The party said in its Oct. 3 statement that it had successfully “pushed” the Liberals to extend the tax holiday, which it said resulted in federal tax savings of 10 cents per litre on gasoline and four cents per litre on diesel.
The Conservatives also cited concerns from the Grain Growers of Canada, who said fuel for a single large combine could cost $15,120 more this harvest than last year because of higher diesel prices. The estimate is based on a Class 7-8 combine operating eight hours a day for 30 days.
The Conservatives’ announcement came as G7 countries announced they had agreed to release 100 million barrels of oil through the International Energy Agency over four months, including a substantial amount of diesel within the first 20 days.
The G7 countries also said they would coordinate maintenance schedules across refineries to prevent simultaneous capacity shutdowns and encourage countries with significant refining capacity to increase production of refined products, particularly diesel.
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