 鲜花( 98)  鸡蛋( 0)
|
Gas prices are rising while crude prices are falling. What gives?, n" M; Q4 k2 K
Published: Friday, January 16, 2009 | 5:11 PM ET
1 q' t; f7 M8 m! q( d0 t; iCanadian Press NewsItem/NewsComponent/NewsLines/ByLine5 Q. V0 |7 z: O: M" _. }6 C
# t$ j" y0 A2 {) B0 q) _7 ^& jCALGARY - With crude oil prices falling, motorists may wonder why gasoline prices are heading in the other direction.
8 I1 t$ w0 Z) p, A7 j7 a t4 e2 W
$ E! _; r+ w- A9 oThe 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.
9 `4 p U% z& o+ e* s! M# n. ^, n Y5 p7 \! ?
Calgarians were paying on average 81.5 cents per litre - about a four-cent jump in just one day.
3 l( C1 T n( V: c9 }8 g2 }2 e0 H3 ]1 o
"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 p% K, @8 Y
6 [" z5 o) @8 f2 b0 N uBut Friday's price is still a welcome respite from the $1.40-level gas many Canadian cities faced during the summer.6 H+ h; O4 O, P1 ~' V5 ]
7 a; v7 G. l; G, [0 ?' ["I definitely changed my habits in the summer. I was going to go on two road trips, which I did not go on by virtue of the fact that the prices were so high," Lawnikanis said.
* v" ^- _% i* R+ F6 _6 G* L8 B, D: v6 b
"Because of the fact that the prices are so reasonable, I've actually taken the liberty to drive more. I've really enjoyed doing more driving."9 @$ U3 L9 I( v1 D+ y( ~' _- F/ \
2 Q5 Q/ q! s: AIn Toronto Friday, pump prices were 80.9 cents per litre. On Thursday they were 79.4 and a week ago they were 74.2. ^3 _+ O# q1 v/ T/ U. L' T) Q
8 J9 I8 g9 I( q% u) ~9 v4 k8 tVancouver, which has higher gas taxes than other cities, has prices of 94.7 per litre, up from 87.5 a week ago.
7 P0 c: ^+ j8 f! {( b
9 S- U1 n1 H, HThe price of crude oil, the main ingredient in gasoline, has been dropping steeply since it's peak of $147 reached in July.+ }8 F. ]3 Q/ E) @6 ~0 S
. ] f3 Z4 C2 _5 M- w
The February contract for crude oil settled at US$36.51 on the New York Mercantile Exchange, down from more than US$50 a barrel a week ago.
4 n5 |( r! L1 t4 m. S# Q
; i5 B: M V) D$ k- O( t" b4 R2 [2 S. M"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.
; `" m. P( b# L% J8 Q' k1 E9 z8 x" j) q) D( X/ d
Industry players would say they have to account for transportation, marketing and other expenses - not to mention taxes, which vary from province to province.
1 w& o1 d3 E# z1 ] M2 o/ a. d0 `1 x! @* v6 O2 u, l
But those oil companies - private-sector players in a free-market system - also want to turn a profit." g/ U5 w7 \4 } m
8 f1 ^8 N1 P6 ]' F
"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.
x5 R( M; M. U/ n! Y, n: }" P! u& B: b- \0 h. j' L' @: j, X# W. ?
"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."% ^2 Z% L6 @% Q
$ G v. V' X1 w+ D; J7 QAnother explanation could be that the February contract for crude oil expires on Tuesday, and the contract for March is already significantly higher, settling at $42.57 on Friday.# o* R- @& P# D/ r
/ _* }" [8 ]7 F. b/ r* s$ N"(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.
+ k: S& `( @& |
% S- V% I3 W8 h8 X9 L7 w* AHirsch 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 a) Q0 `! z( k7 L4 ?9 c/ T2 b, ?) r1 C$ Z# w* L
"I'm not seeing a lot of strengthening in crude oil prices over the next six months," he said.
5 l# b2 E+ `; j; ]; K @ W. o9 A) D
"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."
/ B* z& i, R& e+ p2 ~) P6 d0 a- a* c7 q5 @ p
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.- p' h" ?+ f# h5 [8 w U
: W) F9 u8 y! u/ d"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./ R. K! }8 C. L5 |# _" U$ f4 T
. K; Q. e# E9 {1 C# } X9 y0 ^
"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." |
|