 鲜花( 98)  鸡蛋( 0)
|
Gas prices are rising while crude prices are falling. What gives?
/ R1 M; L& ~+ H' OPublished: Friday, January 16, 2009 | 5:11 PM ET% G& S: O1 c) w; U" G2 T/ w
Canadian Press NewsItem/NewsComponent/NewsLines/ByLine
$ M( u: K: {5 R( |) ]& G
- W" k7 A+ Z7 A- p N' A& xCALGARY - With crude oil prices falling, motorists may wonder why gasoline prices are heading in the other direction.2 M- i/ \. n h0 C
1 y/ F" S2 L8 p, ?/ T! ?) f
The average Canadian pump price rose to around 81.75 cents per litre Friday - more than three cents more than a week ago, according to the price-tracking website Gasbuddy.com.
, s/ ?! o. @1 ^: S% g( }; F/ r5 I
4 u3 w5 m: s" i& F7 d2 {. M( cCalgarians were paying on average 81.5 cents per litre - about a four-cent jump in just one day.2 O" |! S% M! o7 E
/ @( a/ J4 E9 G1 E( E5 Y"I don't actually understand it and I do work in the oil and gas industry, so I'm perplexed about it," said Paul Lawnikanis as he filled up his truck at a Calgary Esso station, which was selling gas for 80.4 cents per litre.; r; f! q/ z3 _
; M9 U9 `; L D+ yBut Friday's price is still a welcome respite from the $1.40-level gas many Canadian cities faced during the summer.: q: H4 }: M7 g, E/ i/ O
( T" A0 T- E) z C8 x- w, C"I definitely changed my habits in the summer. I was going to go on two road trips, which I did not go on by virtue of the fact that the prices were so high," Lawnikanis said.' c6 Y8 ]7 N: [7 `) A+ g0 }
' ^$ l+ N# d- a"Because of the fact that the prices are so reasonable, I've actually taken the liberty to drive more. I've really enjoyed doing more driving."
- [& H$ _9 b$ k. _0 z6 _, j5 \
' h. S$ l$ L* U* r$ zIn Toronto Friday, pump prices were 80.9 cents per litre. On Thursday they were 79.4 and a week ago they were 74.2.
4 l* I; W/ n7 M, N. ?: S# T8 p! g$ V
4 `; G. k1 T) k& \Vancouver, which has higher gas taxes than other cities, has prices of 94.7 per litre, up from 87.5 a week ago.
) i8 \- G2 [; [) K/ i* U U
1 ^9 ?2 c& {* K" MThe price of crude oil, the main ingredient in gasoline, has been dropping steeply since it's peak of $147 reached in July.! t/ w0 @4 r! e( r/ P6 |4 D
: q, \* a6 d: r6 F! VThe February contract for crude oil settled at US$36.51 on the New York Mercantile Exchange, down from more than US$50 a barrel a week ago." @8 k+ Q& ?( h# y& T' a' h
/ o8 F, T& L' Y3 g6 t' {"Crude oil is an important input into the distillation of gasoline. But there's a lot of other factors as well," said Todd Hirsch, senior economist with ATB Financial in Calgary.
1 X* i: e; S3 n" Y8 d2 x
4 Q5 K& j0 ^! `$ o: ?3 y- RIndustry players would say they have to account for transportation, marketing and other expenses - not to mention taxes, which vary from province to province.
1 O( z& d0 L+ L' i
- O1 E- a4 S- K7 m0 ]/ b2 `But those oil companies - private-sector players in a free-market system - also want to turn a profit.; J6 Z7 P' U) a: s% z! i' I
, @; I* _ N/ {2 D2 `( Q3 o
"Without question those gasoline prices are going to be the highest they think they can get away with without their competitor undercutting them," said Hirsch.2 j, y% {; k7 I) n. C9 q
3 M c' ~5 j% O& q$ ` G
"They're out to maximize their profits for their shareholders. I don't think there's anything evil going on in them trying to get the highest price. Every retailer in the country does this."8 u, Z5 _3 G1 f: B
5 A S/ {$ o1 Z# S1 I
Another explanation could be that the February contract for crude oil expires on Tuesday, and the contract for March is already significantly higher, settling at $42.57 on Friday.% p, i' Z% P2 k* [. K
4 z1 v: L. K1 s2 r2 d2 }- \( ?"(The oil companies) might have realized that while prices were low in the last couple of weeks, they knew that there was going to be a correction," Hirsch said.7 x5 p6 z/ D; g+ U
4 a0 X- e. q' A( V+ B Q4 R# N5 YHirsch expects pump prices to bounce between 60 and 90 cents per litre over the next few months, but not retesting the heights of last summer.2 B: l$ [$ g) P- P2 q b* L
& t$ w! d; }6 Q8 Q; h
"I'm not seeing a lot of strengthening in crude oil prices over the next six months," he said.0 S) z9 K( @: F1 I5 ?, ?
: N7 o) n) X" \# f" O2 K
"In the next six months I would expect to see gasoline prices more or less in the range they're in now, maybe firming up a little bit towards the spring and summer driving season as demand rises."$ v7 X9 t# [: H% \7 j; u& r! H7 Q
3 p) p/ J; U/ A9 ~ o& ~2 B
But Gasbuddy.com co-founder Jason Toews said he sees gas prices going higher than their current levels because of a slowdown in Alberta's oilsands and expected production cuts by the Organization of Petroleum Exploring Countries.# a8 [. [ y, Q/ F* E
2 `7 j6 I$ a0 G3 E6 y5 E6 ^( h! C
"With lower supplies of crude oil in the market it's going to push crude oil prices up, especially if the economy starts to recover a little bit," Toews said.
: @& O0 ?! }7 @9 j2 {# `
; B9 d- M C- ?+ k+ h6 f$ A"Once the summer demand for gasoline comes, we're going to see gas prices go up quite a bit from where they are right now. We're going to see a return of a $1 per litre gas for sure and we may even see up to $1.20 per litre." |
|