Canada:Supply low, gas prices soar again

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Supply low, gas prices soar again Crude oil prices flow through to neighbourhood pumps DAVID PARKINSON Alberta Bureau Friday, September 8, 2000

Calgary -- Canadian motorists were greeted with more gasoline price increases in many major markets yesterday, as extremely low gasoline supplies and surging world crude oil prices found their way to neighbourhood pumps.

Prices in Montreal jumped to 85.9 cents a litre at many stations for regular unleaded gasoline, up from about 77 cents.

"This is horrible," an unidentified Montreal woman in a family van told RDI, Radio Canada's all-news television service. "As a worker who has four children to feed, having to pay gas at these prices is disastrous."

Toronto drivers were hit with a three-cents-a-litre increase, to about 77.5 cents a litre at downtown stations. Calgary drivers saw prices creep up two cents, to 68.9 cents a litre at most stations. In Vancouver, prices actually eased a bit to 75.9 cents a litre, but only after stations had jacked prices up more than seven cents a litre late Tuesday night, to 79.5 cents a litre.

In Newfoundland, which already has some of the highest prices in Canada, things are getting a bit worse. Prices in Gander were set to rise another four cents a litre overnight, to 89.9 cents a litre for regular unleaded, 96.9 cents for premium.

"I was smart and gassed up my car," said Tracy White, an employee at the Irving Oil gas station in Gander who was privy to last night's price increase.

Major gasoline retailers said the rise is partially due to the climb of crude oil prices, which hit another 10-year high yesterday. The benchmark October crude contract on the New York Mercantile Exchange rose 49 cents (U.S.) to close at $35.39 (U.S.) a barrel.

The Organization of Petroleum Exporting Countries is expected to announce output increases at its meeting in Vienna on Sunday, but analysts hold out little hope the move will be enough to ease prices.

However, the immediate cause of the gasoline climb is the lack of supplies nearer home. North America's already-thin gasoline stockpiles became even thinner due to heavy demand over the Labour Day weekend, pushing wholesale prices up, which translated to higher prices at the pumps.

"We certainly understand people's frustrations," said Jeff Mann, a spokesman for Calgary-based Shell Canada Ltd., one of the country's largest gasoline retailers. However, he said his company has to pass along wholesale price increases to retail customers to make a profit.

"Margins are razor-thin," Mr. Mann said. He noted that between 40 per cent and 50 per cent of the pump price consists of federal and provincial taxes. Another one-third of the current price reflects the high crude oil prices.

Some consumer groups have been calling for the federal and provincial governments to ease the tax burden at the pumps, to offset rising prices. Taxes on gasoline vary widely by province, with Albertans paying about 24 cents a litre in taxes while Newfoundlanders pay about 38 cents a litre.

The Canadian Trucking Alliance, which represents commercial truck drivers, called yesterday for the Prime Minister and provincial premiers to address the surging fuel prices at the first ministers conference next Monday in Ottawa.

"It really is of great concern to us," said Massimo Bergamini, vice-president of public affairs for the CTA in Ottawa. "One thing governments can look at is whether they could reduce their take," Mr. Bergamini said, noting that federal Finance Minister Paul Martin floated the idea of some tax relief in February, but nothing ever came of it. "We need to get more than just vague assurances from our governments. . . This is reaching a crisis level."

But environmental groups believe high taxes are necessary to discourage the use of motor vehicles and reduce greenhouse emissions. Michael Ervin, a petroleum-industry consultant who closely follows gasoline price trends, said that even gasoline prices at current high levels have little impact on curbing vehicle use. He said only significantly higher taxes -- such as those in Japan and Europe -- would make a dent in consumption. The price for regular unleaded gasoline in Japan averages over $1.40 a litre.

"It's in a different league," he said of taxes in those countries.

Harry Herman, a Calgary motorist who partly filled his Nissan Pathfinder sport utility vehicle yesterday, agrees that cutting taxes might not be the best answer.

"If global warming is really taking off, then maybe they should tax the bejesus out of us," he said.

Other consumers are resigned to paying higher prices."It's like everything else -- we just pay it," said Ruth Spence, president of the Northwest Territories chapter of the Consumers Association of Canada in Yellowknife, where prices were 85.9 cents a litre yesterday.

http://www.theglobeandmail.com/gam/National/20000908/UGASSN.html

-- Martin Thompson (mthom1927@aol.com), September 08, 2000

Answers

Give us the electric car!

-- Rachel Gibson (rgibson@hotmail.com), September 08, 2000.

how about an electric bike?

A buddy has one, it is very expensive, but he uses his car about three times a month. He's 10 miles from work, and takes the back streets.

Please wear a helmet and gloves!

-- (perry@ofuzzy1.com), September 08, 2000.


Opps for got the http://

How about an ebike.com ?

A buddy has one, it is very expensive, but he uses his car about three times a month. He's 10 miles from work, and takes the back streets.

Please wear a helmet and gloves!

-- (perry@ofuzzy1.com), September 08, 2000.


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