 鲜花( 98)  鸡蛋( 0)
|
Gas prices are rising while crude prices are falling. What gives?
9 W; @ t, L4 y; K5 T6 ^Published: Friday, January 16, 2009 | 5:11 PM ET' x T+ y, t) k' o0 Z0 D# U
Canadian Press NewsItem/NewsComponent/NewsLines/ByLine7 B, Y, a' x6 A8 s" ]* a
* t) ^3 E! j2 ]5 Q( R( ?) \1 E P: i
CALGARY - With crude oil prices falling, motorists may wonder why gasoline prices are heading in the other direction.5 Q3 L, `" e0 l* i5 A3 @
; _" {0 Q6 A1 F' f, SThe 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.; ~2 F7 q' s9 ~! D6 O
" a. C* S# p' C( BCalgarians were paying on average 81.5 cents per litre - about a four-cent jump in just one day.# Z/ Z A' e9 z0 B; v8 r
0 s4 W! F0 @: s( J$ V: e3 f
"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.8 z8 z; L# {" m' ?) Y) _; \2 _
& C/ ^' Q* B1 s
But Friday's price is still a welcome respite from the $1.40-level gas many Canadian cities faced during the summer." b4 D% m7 W2 D) u2 O
; Q9 h; U2 f( k% d"I definitely changed my habits in the summer. I was going to go on two road trips, which I did not go on by virtue of the fact that the prices were so high," Lawnikanis said.4 c2 x) [3 S3 i5 k# R3 a: y
" b2 H% F% B7 M3 s$ H) @/ {6 }
"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." y3 ? n& Z8 H' ~$ g1 p2 H- q
% f( ^ h2 j, s" ?) xIn Toronto Friday, pump prices were 80.9 cents per litre. On Thursday they were 79.4 and a week ago they were 74.2.& g( z/ a8 j9 M
# A6 V4 O! N+ G/ X# D5 e+ o0 s! w8 DVancouver, which has higher gas taxes than other cities, has prices of 94.7 per litre, up from 87.5 a week ago.
' I5 z) q. R, e6 V& ^
8 O! d4 \: _1 kThe price of crude oil, the main ingredient in gasoline, has been dropping steeply since it's peak of $147 reached in July.
% V+ u, L, n) J5 b$ {- D: D6 r8 V
1 R. R& `& R& X+ r4 F. ?( G# sThe February contract for crude oil settled at US$36.51 on the New York Mercantile Exchange, down from more than US$50 a barrel a week ago.7 s+ p9 I3 O) h5 t) V1 P; n- ?5 Z
& ^# }6 U: R, S5 i9 W( j; q"Crude oil is an important input into the distillation of gasoline. But there's a lot of other factors as well," said Todd Hirsch, senior economist with ATB Financial in Calgary.
& F1 q* m8 _( c' ^3 ]: J
4 |3 N1 Y( z" }Industry players would say they have to account for transportation, marketing and other expenses - not to mention taxes, which vary from province to province.5 {/ Z3 A1 e- {. n* q
; O# e7 f! V# ~! U$ U* q* P+ wBut those oil companies - private-sector players in a free-market system - also want to turn a profit.0 t( F. t( S. c7 R, S
, Q0 K; \1 R' S1 S) w! j2 g
"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.
6 g( B. }2 M6 J$ `, s: @' h; X( [
"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.": T. x/ f0 S4 }) l
0 ~- m! O$ e9 tAnother explanation could be that the February contract for crude oil expires on Tuesday, and the contract for March is already significantly higher, settling at $42.57 on Friday.; I& w D) s: t
) i# n! l* v3 R- A"(The oil companies) might have realized that while prices were low in the last couple of weeks, they knew that there was going to be a correction," Hirsch said. e" \! m7 t$ z' m( c* B- y m
& Z1 }, d. O, t) V/ xHirsch 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.
) }! u! s$ t. Z& U' U5 [" I- V' f: `( L
"I'm not seeing a lot of strengthening in crude oil prices over the next six months," he said., L! c9 @/ m; ~0 K2 D: C+ ?
. q" u& U7 I' 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."6 h# `% ]6 E' z1 A% D" \/ G
$ b: P" w, ?6 m% H6 d+ G8 DBut 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.) b$ D4 s C7 K6 J9 x
' V( z7 T- V( N" P
"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.
2 r2 d2 q h# l0 i2 x
, C9 y( U* b, Y3 e"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." |
|