$1-a-litre gas is here to stay, so get used to it, experts say

$1-a-litre gas is here to stay, so get used to it, experts say

www.canada.com

With spring finally here, the call of the open road may go unanswered as the price of gasoline has marched in lock-step with the rising temperatures.

Yesterday morning, prices at many Ottawa service stations hovered just under $1.10 a litre, continuing the upward trend of the past few weeks.

Cathy Hay, of M.J. Ervin and Associates Inc., a Calgary-based consulting firm that tracks fuel prices, said "the days of 75-cent-a-litre gasoline are not going to come back."

(visit the link for the full news article)

The cost of a litre of gas in Vancouver is about $1.20 and in Ontarion, hovering near $1.10. I've read that a refiinery or two are shut down for maintenance, but I've also read that corporate profits exceed 30% for some

So what is really driving the cost of gas? Could it be corporate greed or are we being 'pushed off the road' through price hikes?

www.canada.com
(visit the link for the full news article)

In case you're not familiar with the conversion, multiply the price of gas times 3.79.

So, if the cheapest gas in Canada is $1.10, then that would work out a smidge under $4.20 cdn

(edit to add)

related article in the USA

Gas prices might increase 24 cents

Gasoline prices could rocket 24 cents a gallon the next few days, as stations across the USA scramble to keep up with big jumps in the prices of oil and wholesale gas, a veteran energy-price analyst forecast Thursday.
"It's going to be brutal, horrendous," says Peter Beutel, president of energy-price tracker Cameron Hanover. He has followed energy markets for nearly three decades

[edit on 2/5/07 by masqua]

I'm willing to bet we see $1.50 a litre this summer (and sooner rather than later) and if there are any interruptions in oil supplies (hurricanes, war etc.) we could spike to $2/litre.

Several factors are at play.

A refinery was damaged by a fire in Ontario about a month ago and caused shortages in certain regions. Around the same time a Montreal refinery had some problems (not sure what the cause was but heard it on the local news).

The distillate inventory numbers are very low for this time of year and when driving season gets into full swing, expect prices to jump. Look for the first signs of trouble on this front around "May-two-four" week-end for Canadians.

Why distillate inventories are low is suspected to be related to the low gas prices last fall for the US election. It's rumoured that inventory was used to flood the market with cheap gas. Oil is traded as a singular commodity with one price being set for the world and in North America our gasoline markets are somewhat interrelated (like the electricity grid). Inventory has not recovered due to limited refining capacity in the US (especially after Katrina/Rita) and the two damaged refineries in Canada.

There is also ample evidence that world oil production peaked in 2006 and that Saudi Arabia is in fact in production decline with the Ghawar "elephant field" water cuts increasing (they pump sea water to keep the pressure up in the reservoir) and production has been falling. There are many threads over at The Oil Drum discussing all of these issues. Evidence points to an almost 8% production decline for Saudi Arabia in 2006.

Lastly, world oil demand is an unstoppable force. There is little spare capacity and demand is outstripping supply.

But you won't hear about these problems in the mainstream media. It's all an evil oil company conspiracy. One of the only conspiracies the MSM will allow the public to believe (and that to me speaks volumes).

Bottom line is that "cheap abundant oil" and consequently cheap gas is a thing of the past.

So yeah, get used to it.

BTW when I bought my first brand new car in 1998 I remember my first fill-up was 50c/litre
.
edit: my keyboard hates me

[edit on 5/2/2007 by Gools]

The Good News...

...is that higher prices for gas and oil make alternative energy sources more attractive.

That doesn't mean the transitions will be painless or pleasant, but the bottom line is the bottom line, and as fossil fuels become more expensive, those "wacky" alternatives start looking a lot less wacky.

It's not really the cost of gas for personal use that scares me, it's the rising cost of transporting food which is really going to whack consumers.

Doubling the cost of a litre of gas to $2.00 will have a radical effect on inflation, interest rates and many other infrastructure items.

John Doe may think about a Prius or a small economy car instead of a 4x4, but he's still going to dole out megabucks for everything else too.

I'm not too good with conversions, But I was shocked to see 1 gallon of unleaded fuel here in southern Utah today at $3.27

Why?

When the oil companies are continuously posting record profits, which by the way has been the case since the weeks and early months following Hurricane Katrina.

When there is not a raise in middle eastern tensions, or a hurricane, they still find ways to keep the price up.

What were you paying just 3 to 4 years ago for the same amount of gas today?

A liter is a little more that a quart is it not?

So if you figure 4 quarts make a gallon, and I'm paying $3.20 for a gallon, then you guys are paying roughly $4 for a little more than a gallon.

Edit: i realize it should be $4 a gallon for Canadians.


[edit on 2-5-2007 by thehumbleone]

Originally posted by thehumbleone
A liter is a little more that a quart is it not?

So if you figure 4 quarts make a gallon, and I'm paying 3.20 for a gallon, then you guys are paying roughly 3$ for a little more than a gallon, which is not bad as compared to America.

From the link in the 3rd post

A 24-cent jump in the price of gas would bump unleaded regular to a nationwide average of about $2.16 a gallon, blowing through last May's record of about $2.06. It could go higher as increased warm-weather driving in another two months pushes up demand, and therefore prices, forecasters say.

current rate is 90.05cdn on the US dollar

So, if you wanted to match prices, you would need to convert CDN into USD (x 1.11).

Your average high price last May was 2.06 x 1.11= $2.29 CDN (rounded off)

To see how many litres there are in a gallon, multiply the litres x 3.79.









[edit on 2/5/07 by masqua]

In Australia we are paying between AUD$1.15 and AUD$1.30 per litre in capital cities depending on which state you live in.

The interesting thing is we can all guess here which days the price will go up. For example, Wednesdays are the cheapest day to fill up – Friday through Monday are the most expensive.

The day before a public holiday ALWAYS sees the price sky rocket.

For years the public have been putting pressure on our government to stop this type of price fixing and collusion between the fuel suppliers but to date they have done very little.

It is no surprise though – the Australia government pockets a healthy little cut from every litre you put into your car.

So is this the same elsewhere? IE: Price fixing and collusion? And governments getting a cut of the action…

As gas prices goes up, the oil barons reap record profits, and we the consumer get to feel the heat when everything that has to do with gas get expensive.

So is not only gas what we are paying for more, like another member just said.

You also have to understand the US Dollar is not worth so much on the world stage now. Things are going to be more expensive. I personally have noticed that the dollar has lost 25% of it's value in Thailand alone - that's in just under a year!

It's not looking good for the dollar, I'm afraid.

Whining, whining I hear from North Americans on gas prices passing the psychological dollar mark.

Well, in Northern Europe that mark was passed soon (if not) a decade ago. Present price are now 2 dollars. If the dollar value hadn't been down it would have been even more.

To me oil prices are one of the biggest mysteries of any organism. Frankly I never got how it works.

Take the SE Asian country I'm in, 20 USD will take you from one end of the country to the other by VIP bus. It's about a 1000 mile journey. Before the present rise caused by the Iraq invasion it used to be 15 USD, a rise about 50 percent in the fare. But in the same period it has been a 100 percent hike on the market of crude, reflected in the actual prices at the gas stations in Europe ...as in this country.

Fact is subventions and all kinds of constructions of the market makes prices disproportional, but somehow mass-transportation doesn't seems to be affected proportionally. A long haul air ticket costs the same as 6-7 years ago.

Though I don't get how it works, I've been aware that where most of the profit for this trade goes, has always been where the gas prize has been --both de facto and relatively-- at its lowest. But not profits. Now big oil wants its share from you, their fellow countrymen.

Originally posted by UM_Gazz
I'm not too good with conversions, But I was shocked to see 1 gallon of unleaded fuel here in southern Utah today at $3.27

Thats not too bad actually, In the SF Bay Area we are looking at 3.50 or so and higher. In SF itself 3.80-3.90 is the norm

Ya,i hear ya fredT. Slightly better here at the southern end of the valley.

www.bakersfieldgasprices.com...


Ridiculous,all this oil/refineries here but cant get a break on gas.

Originally posted by spanishcaravan
Ya,i hear ya fredT. Slightly better here at the southern end of the valley.

www.bakersfieldgasprices.com...

Not too bad. We do transports out of the central valley all the time and gas prices are high in places like Fresno, Tracy, Modesto, Stockton etc.

Cool website BTW Costco around here usually is the cheapest

You know, you could scrap your social services, reduce your taxes to American levels, and then gas would probably be the same or less what it is Stateside.

The Germans figured out how to make gasoline from coal during WW2. This is a dirty little secret that the Rockefellars have kept hushed up so as to protect Standard oils' offspring and all the refining capacity that it bottlenecks to inflate price.

think thats bad it's already £1 a litre in England more in some parts of Scotland time to dust off my old mountain bike methinks

Try coming to england where a litre is smaller than an american one and costs us about 92-98p a litre. That works out about 2$US. I would be estatic if I could pay about 50p for petrol.