Gas to drop while heating and stove oils increase
Markets eye Northern Iraq
Media release
St. John’s, NL, December 18, 2007- Consumers in Newfoundland and Labrador will see a slight drop in gasoline prices this coming Thursday ahead of the long drive home, that’s from George Murphy of the Consumer Group for Fair Gas Prices.
“With thirteen days out of a possible fourteen days of data on hand, there’s enough there to call the shot on how pricing will look this coming Thursday. It looks like gas prices will drop by 1.3 cents a litre while heating and stove oils will likely increase by somewhere close to one cent a litre,” said Murphy.
“Inventories of heating oil remain a concern while we are into the January and February buying contracts. We still have not seen substantial increases in inventories even though refiner capacity has picked up slightly. Cold and stormy weather across North America has also impacted demand numbers.
“The situation in Northern Iraq is playing heavily into the markets today as Turkish forces have invaded some parts of Iraq to fight Kurdish rebels. There is a fear in the markets that oil exports from Northern Iraq will face possible disruptions and that has played into the markets significantly. We may see slightly larger increase in heating and stove oils and a lessening of the gasoline numbers as a result. Before the news today, we were relatively stable price wise.”
The Public utilities Board will set prices for fuels this coming Thursday morning.
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For more information, contact;
George Murphy
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
Tuesday, December 18, 2007
Thursday, December 06, 2007
Government announces details of home heating rebate
Some people left out
News release
St. John’s, NL, December 6, 2007- Government has announced details of the home heating rebate that will be given out this year but, some people will not be able to avail of the program in spite of increased revenues from oil reources.
“I feel that government missed out on an opportunity to allow all Newfoundland and Labradorians to benefit from rising government revenues from increased offshore oil revenues. Everyone, regardless of income, should have been able to get government assistance to pay for the rising costs of heating. Government will still benefit from record prices in spite of this rebate,” said George Murphy of the Consumer Group for Fair Gas Prices.
“The government of New Brunswick is talking about increasing taxes in their province to recoup revenue from the federal government dropping part of its portion of the HST. If they succeed in increasing the provincial take there, the province of Newfoundland and Labrador has to follow suit and increase taxes on heat as well. The Government of Newfoundland and Labrador has to actively look at leaving the HST agreement it signed back in 1997 in order to remove all taxes on heat or enter into negotiations with the other signatories to the agreement in order to revise the agreement. The province needs to start to express ‘fiscal independence’ and call our own shot. There never should have been taxes applied to necessities like heat.
“I am pleased that the income threshold has increased, but the threshold they have set still bars anyone with marginal incomes close to the cutoff point. If I am a two income household that collectively makes $41,000.00, then my household is not eligible unless I meet some of the special parameters set out. The rebate should cover everyone and not just a select few. There are still going to be consumers out there falling between the cracks. The rebate gets less with income exceeding $35,000.00 and cuts off at $40,000.00. The rebate should have been given to everyone regardless of income. The least that government should do here is to allow the applications from people who are close to the threshold as they may have special circumstances that are slightly outside the requirements of the rebate program. All residents, regardless of income, should have been able to benefit from increased oil revenues.
“We are still awaiting the announcement of a home retrofit program to allow grants to people to increase the energy efficiency of their homes and help them reign in rising energy costs. Again, while the government has made untold millions in increasing oil revenues, it has not yet made available a new home retrofit program that is cost effective and beneficial to the environment.
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For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Some people left out
News release
St. John’s, NL, December 6, 2007- Government has announced details of the home heating rebate that will be given out this year but, some people will not be able to avail of the program in spite of increased revenues from oil reources.
“I feel that government missed out on an opportunity to allow all Newfoundland and Labradorians to benefit from rising government revenues from increased offshore oil revenues. Everyone, regardless of income, should have been able to get government assistance to pay for the rising costs of heating. Government will still benefit from record prices in spite of this rebate,” said George Murphy of the Consumer Group for Fair Gas Prices.
“The government of New Brunswick is talking about increasing taxes in their province to recoup revenue from the federal government dropping part of its portion of the HST. If they succeed in increasing the provincial take there, the province of Newfoundland and Labrador has to follow suit and increase taxes on heat as well. The Government of Newfoundland and Labrador has to actively look at leaving the HST agreement it signed back in 1997 in order to remove all taxes on heat or enter into negotiations with the other signatories to the agreement in order to revise the agreement. The province needs to start to express ‘fiscal independence’ and call our own shot. There never should have been taxes applied to necessities like heat.
“I am pleased that the income threshold has increased, but the threshold they have set still bars anyone with marginal incomes close to the cutoff point. If I am a two income household that collectively makes $41,000.00, then my household is not eligible unless I meet some of the special parameters set out. The rebate should cover everyone and not just a select few. There are still going to be consumers out there falling between the cracks. The rebate gets less with income exceeding $35,000.00 and cuts off at $40,000.00. The rebate should have been given to everyone regardless of income. The least that government should do here is to allow the applications from people who are close to the threshold as they may have special circumstances that are slightly outside the requirements of the rebate program. All residents, regardless of income, should have been able to benefit from increased oil revenues.
“We are still awaiting the announcement of a home retrofit program to allow grants to people to increase the energy efficiency of their homes and help them reign in rising energy costs. Again, while the government has made untold millions in increasing oil revenues, it has not yet made available a new home retrofit program that is cost effective and beneficial to the environment.
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For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Tuesday, December 04, 2007
Slight drop in distillates coming
Gasoline to remain little changed
News release
St. John’s, NL, December 4, 2007- Consumers of distillates like stove oils, heating and diesel may be set to see a slight downwards adjustment in prices this coming Thursday, that’s from George Murphy of the Consumer Group for Fair Gas Prices.
“The loss in dollar value against the U.S greenback did exactly what we had feared would happen; absorb some of the drop in spot pricing of distillates and help support prices rather than see it go into freefall,” Murphy said. “The price of the refined product only lost a clear three cents since last adjustment November 28, 2007 when prices were interrupted. The U.S markets saw a loss of almost twelve cents a gallon off heating oil futures pricing this last week.
“While coming close to a four cent interruption last week, we’ve watched spots fall again in the second week bringing us to a ‘break even point” where there may be very little change to gasoline pricing, up or down. With twelve out of a possible fourteen days of data, gasoline shows an increase of 4/10ths of a cent while heating and stove oils will drop by three cents. If numbers hold steady for the next two business days, I expect there to be little change from those numbers though gasoline will be closer to a zero change.
“Heating oil spot pricing remains fourteen cents a litre higher than the same time last year (December 04/06) while gasoline spots are now nine cents a litre higher. While OPEC may have been talking about the possibility of an increase in production at its next meeting today, I don’t expect there to be positive news on that front. A lot of OPEC members like Libya aren’t ready to increase output. Consumers have another two or three months left to ride out this winter storm in heating and stove oils while, for gasoline users, a storm may be just developing.”
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For more information, contact;
George Murphy
Group researcher/member
Consumer Group for Fair Gas Prices
Gasoline to remain little changed
News release
St. John’s, NL, December 4, 2007- Consumers of distillates like stove oils, heating and diesel may be set to see a slight downwards adjustment in prices this coming Thursday, that’s from George Murphy of the Consumer Group for Fair Gas Prices.
“The loss in dollar value against the U.S greenback did exactly what we had feared would happen; absorb some of the drop in spot pricing of distillates and help support prices rather than see it go into freefall,” Murphy said. “The price of the refined product only lost a clear three cents since last adjustment November 28, 2007 when prices were interrupted. The U.S markets saw a loss of almost twelve cents a gallon off heating oil futures pricing this last week.
“While coming close to a four cent interruption last week, we’ve watched spots fall again in the second week bringing us to a ‘break even point” where there may be very little change to gasoline pricing, up or down. With twelve out of a possible fourteen days of data, gasoline shows an increase of 4/10ths of a cent while heating and stove oils will drop by three cents. If numbers hold steady for the next two business days, I expect there to be little change from those numbers though gasoline will be closer to a zero change.
“Heating oil spot pricing remains fourteen cents a litre higher than the same time last year (December 04/06) while gasoline spots are now nine cents a litre higher. While OPEC may have been talking about the possibility of an increase in production at its next meeting today, I don’t expect there to be positive news on that front. A lot of OPEC members like Libya aren’t ready to increase output. Consumers have another two or three months left to ride out this winter storm in heating and stove oils while, for gasoline users, a storm may be just developing.”
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For more information, contact;
George Murphy
Group researcher/member
Consumer Group for Fair Gas Prices
Wednesday, November 28, 2007
Interrupter criteria met for stove oils
Premier asked to “Expedite” rebate and retrofit programs
News release
St. John’s, NL, November 28, 2007- Numbers are showing that the Petroleum Pricing Office will be forced to bump up pricing to consumers of stove oils and possibly heating oils early Thursday as the price for those important consumer petroleum products continues to rise.
“With six out a possible seven days, I have numbers that warrant a five cent a litre increase on stove oils. Heating oil being also part of the same distillate group will probably see a substantial increase also. Jet fuel and #2 heating oil are blended during the winter months as jet is used as an antifreeze agent. Jet fuel has traded very high, much higher than stove oils the past two weeks or so. It’s probably inevitable that heating oils will also take a shot upwards,” Murphy said. “Gasoline numbers show a 3.3 cent a litre increase so far but that won’t happen this Thursday as the criteria for interruption weren’t met for that fuel”
“That would make our high price in the St. John’s area for heating oil hit 92.47 cents a litre, shattering last years record. The fact that we are now in a downturn with the Canadian dollar, losing value against its U.S counterpart and that has only aggravated the problem. We predicted that this would happen and come back to complicate things for consumers. If the Bank of Canada reduces interest rates later this week, it will only aggravate it further.
“There’s one word for government in all this. ‘Expedite!’ As consumers, we have waited long enough for an announcement on a heating and rebate program that will include everyone. We warned the government to get ready to have their program in place last July and we’re still waiting. When the next increase in price hits, we’ll be waiting still.”
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Premier asked to “Expedite” rebate and retrofit programs
News release
St. John’s, NL, November 28, 2007- Numbers are showing that the Petroleum Pricing Office will be forced to bump up pricing to consumers of stove oils and possibly heating oils early Thursday as the price for those important consumer petroleum products continues to rise.
“With six out a possible seven days, I have numbers that warrant a five cent a litre increase on stove oils. Heating oil being also part of the same distillate group will probably see a substantial increase also. Jet fuel and #2 heating oil are blended during the winter months as jet is used as an antifreeze agent. Jet fuel has traded very high, much higher than stove oils the past two weeks or so. It’s probably inevitable that heating oils will also take a shot upwards,” Murphy said. “Gasoline numbers show a 3.3 cent a litre increase so far but that won’t happen this Thursday as the criteria for interruption weren’t met for that fuel”
“That would make our high price in the St. John’s area for heating oil hit 92.47 cents a litre, shattering last years record. The fact that we are now in a downturn with the Canadian dollar, losing value against its U.S counterpart and that has only aggravated the problem. We predicted that this would happen and come back to complicate things for consumers. If the Bank of Canada reduces interest rates later this week, it will only aggravate it further.
“There’s one word for government in all this. ‘Expedite!’ As consumers, we have waited long enough for an announcement on a heating and rebate program that will include everyone. We warned the government to get ready to have their program in place last July and we’re still waiting. When the next increase in price hits, we’ll be waiting still.”
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For more information, contact:
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Wednesday, November 21, 2007
Pricing continues to increase
Numbers show fuel prices increasing this Thursday
News release
St. John’s, NL, November 20, 2007- Fuel prices are set to increase to consumers this coming Thursday and the news may not get any better for the summer driving season, that’s if the numbers hold as they are. While consumers will suffer this winter keeping warm , they will also be hit keeping cool this coming summer.
“The news is not good as we head into winter. Record spot pricing is being reflected in the markets and that means consumers are going to be paying more for important petrol products for the foreseeable future,” said George Murphy, group researcher and member of the Consumer Group for Fair Gas Prices. “There’s even the hint of bad news for the summer if the numbers keep up the way they have been on gasoline.”
Thursday price change
“With twelve days out of a possible fourteen to go on, we’re looking at 2.4 cents per litre up on stove oils and 3.0 cents up on gasoline for this coming Thursday. Heating oil numbers are now reflected by a 25/75 mix of heating and jet fuels. The heating number is showing 2.4 cents but, once again, 25 per cent of that is only used. I do not have numbers for jet fuel so, being a distillate also, I can only tell the consumers that those numbers are also up. They should take that as bad news. Today, oil is trading at $98 per barrel so; I don’t expect any lower numbers for the other two days of data.
We're witnessing the opposite effect with the Canadian dollar as well with it losing ground against its US counterpart.What was once an insulating effect is slowly coming back to burn consumers.We've lost five cents there in less than two weeks of measurement. It is essentially, the main reason we're looking at a rough three cents on everything.
Why the numbers are going up
Several reasons are being cited for the next round of increases that we are going to see, and probably will see, in the coming weeks.
The U.S dollars fall against other world currencies has led investors to drive up the cost of oil. While the U.S dollar is seen as a bad investment, they want to put money into other commodities like oil that have a little more security behind them. That’s another reason for the skyrocketing costs of gold. Even OPEC has discussed changing from the U.S dollar and that remains a bone of contention with some OPEC members who disagree with any future change in how oil is measured. Longtime enemies of the U.S, namely Iran and Venezuela, are soliciting for a change from the U.S measurement.
Other reasons for rising costs
. Continuing low refiner capacity. While there have been very modest builds in crude oil and gasoline inventories, there have been draw-downs on distillate inventories. Heating oil costs have risen as a result and the coming winter season has attracted investors there.
· Ongoing world violence. Kind of self explanatory but, we’ve been dealing with this problem for ages now. It’s still there and won’t go away. The problems remain in Northern Iraq remain and Turkey remains keyed to invade the region and pacify the Kurdish population. There remains a supply disruption possibility.
· No boost in OPEC production. OPEC announced last week that it had formally “lost control of pricing of oil product” but it would not be stepping up production of oil as it feels that the “market remains well supplied” with product. The markets reacted by trading up on oil.
Historic numbers
“At this same time last year, November 17/06, spot prices for heating and stove oils were recorded at 48.86 cents a litre. Gasoline spot was recorded at 47.39 cents a litre. This year those numbers are 66.10 cents for heating/stove and 62.53 cents for gasoline. That’s a 17 cent a litre disparity for heating/stove oils and 15 cents for gasoline. I don’t think I have to point out the implications of higher spots this year over last year.
Early summer forecast
“If we don’t see gasoline numbers come down before the spring hits, then we may see new record prices for gasoline again this coming summer. Add that to the fact that the U.S dollar is close to or, almost at par with the Canadian dollar, and we have a potential hit to our tourism industry. It’s going to be a little harder getting tourists from the U.S to drive up for a visit. Is there another tourism initiative in the works to help operators who will need the extra help in attracting visitors?
No announcement of rebate programs
“We’re still waiting for some kind of word from government on any heating rebate or retrofit programming for this year. While consumers are dealing with high pricing at an early stage of the season, those costs are reflective of last February. We still have a long time to go before we hit the winter peak in pricing. We need to make sure that all consumers are helped out with one of the most costly winters in recent memory. All Newfoundland and Labradorians, as well as Canadians, will be paying much higher prices this coming winter and all of them will need help.”
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
Numbers show fuel prices increasing this Thursday
News release
St. John’s, NL, November 20, 2007- Fuel prices are set to increase to consumers this coming Thursday and the news may not get any better for the summer driving season, that’s if the numbers hold as they are. While consumers will suffer this winter keeping warm , they will also be hit keeping cool this coming summer.
“The news is not good as we head into winter. Record spot pricing is being reflected in the markets and that means consumers are going to be paying more for important petrol products for the foreseeable future,” said George Murphy, group researcher and member of the Consumer Group for Fair Gas Prices. “There’s even the hint of bad news for the summer if the numbers keep up the way they have been on gasoline.”
Thursday price change
“With twelve days out of a possible fourteen to go on, we’re looking at 2.4 cents per litre up on stove oils and 3.0 cents up on gasoline for this coming Thursday. Heating oil numbers are now reflected by a 25/75 mix of heating and jet fuels. The heating number is showing 2.4 cents but, once again, 25 per cent of that is only used. I do not have numbers for jet fuel so, being a distillate also, I can only tell the consumers that those numbers are also up. They should take that as bad news. Today, oil is trading at $98 per barrel so; I don’t expect any lower numbers for the other two days of data.
We're witnessing the opposite effect with the Canadian dollar as well with it losing ground against its US counterpart.What was once an insulating effect is slowly coming back to burn consumers.We've lost five cents there in less than two weeks of measurement. It is essentially, the main reason we're looking at a rough three cents on everything.
Why the numbers are going up
Several reasons are being cited for the next round of increases that we are going to see, and probably will see, in the coming weeks.
The U.S dollars fall against other world currencies has led investors to drive up the cost of oil. While the U.S dollar is seen as a bad investment, they want to put money into other commodities like oil that have a little more security behind them. That’s another reason for the skyrocketing costs of gold. Even OPEC has discussed changing from the U.S dollar and that remains a bone of contention with some OPEC members who disagree with any future change in how oil is measured. Longtime enemies of the U.S, namely Iran and Venezuela, are soliciting for a change from the U.S measurement.
Other reasons for rising costs
. Continuing low refiner capacity. While there have been very modest builds in crude oil and gasoline inventories, there have been draw-downs on distillate inventories. Heating oil costs have risen as a result and the coming winter season has attracted investors there.
· Ongoing world violence. Kind of self explanatory but, we’ve been dealing with this problem for ages now. It’s still there and won’t go away. The problems remain in Northern Iraq remain and Turkey remains keyed to invade the region and pacify the Kurdish population. There remains a supply disruption possibility.
· No boost in OPEC production. OPEC announced last week that it had formally “lost control of pricing of oil product” but it would not be stepping up production of oil as it feels that the “market remains well supplied” with product. The markets reacted by trading up on oil.
Historic numbers
“At this same time last year, November 17/06, spot prices for heating and stove oils were recorded at 48.86 cents a litre. Gasoline spot was recorded at 47.39 cents a litre. This year those numbers are 66.10 cents for heating/stove and 62.53 cents for gasoline. That’s a 17 cent a litre disparity for heating/stove oils and 15 cents for gasoline. I don’t think I have to point out the implications of higher spots this year over last year.
Early summer forecast
“If we don’t see gasoline numbers come down before the spring hits, then we may see new record prices for gasoline again this coming summer. Add that to the fact that the U.S dollar is close to or, almost at par with the Canadian dollar, and we have a potential hit to our tourism industry. It’s going to be a little harder getting tourists from the U.S to drive up for a visit. Is there another tourism initiative in the works to help operators who will need the extra help in attracting visitors?
No announcement of rebate programs
“We’re still waiting for some kind of word from government on any heating rebate or retrofit programming for this year. While consumers are dealing with high pricing at an early stage of the season, those costs are reflective of last February. We still have a long time to go before we hit the winter peak in pricing. We need to make sure that all consumers are helped out with one of the most costly winters in recent memory. All Newfoundland and Labradorians, as well as Canadians, will be paying much higher prices this coming winter and all of them will need help.”
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
Tuesday, October 23, 2007
Numbers show prices increasing
Prices well ahead of last year
News release
St. John’s, NL, October 23, 2007 – Increases in heating, stove oils as well as gasoline are to be expected in the coming days but, although the numbers in the increases are small, they are hiding an underlying truth; That consumers are continuing to be hurt by increasing prices.
“For twelve days out of a possible fourteen days, heating and stove oils are showing an increase of 9/10ths of a cent while gasoline is showing an increase of 1.2 cents a litre,” that’s according to George Murphy, group researcher and member of the Consumer Group for Fair Gas Prices. “It’s not a huge increase but it still is indicative of the prediction last week that we’ve hit the low point in spots and that prices would be moving up to the consumer.
“The numbers for this year are well ahead of last year. Heating and stove oil spot prices are now 12 cents a litre higher for the same time period while gasoline spots are that same 12 cents higher. The basic cost of heating and stove oils would now be unaffordable for lower income earners if it weren’t for one fact; the performance of the Canadian dollar. Consumers would be paying upwards of another 11 cents a litre more than what they are seeing now if the dollar had to hold the same value as last year. Any slide in the dollar now could cost the consumer this winter.
“The international situation remains volatile. If Turkey invades the Kurdish territories in Northern Iraq, we could see a disruption in crude supply. A lot of that comes to the US eastern seaboard, Eastern Canada and Europe. While there might be an ample supply right now, the promise of violence in a chief export area of Turkey may possibly turn into a worldwide supply disruption and that means rising pricing of all petroleum products. We still caution the consumer to fill the heating oil tanks in case we run into the world situation in the coming days.
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For more information, contact;
George Murphy
Group researcher/Member
gasprices@hotmail.com
Prices well ahead of last year
News release
St. John’s, NL, October 23, 2007 – Increases in heating, stove oils as well as gasoline are to be expected in the coming days but, although the numbers in the increases are small, they are hiding an underlying truth; That consumers are continuing to be hurt by increasing prices.
“For twelve days out of a possible fourteen days, heating and stove oils are showing an increase of 9/10ths of a cent while gasoline is showing an increase of 1.2 cents a litre,” that’s according to George Murphy, group researcher and member of the Consumer Group for Fair Gas Prices. “It’s not a huge increase but it still is indicative of the prediction last week that we’ve hit the low point in spots and that prices would be moving up to the consumer.
“The numbers for this year are well ahead of last year. Heating and stove oil spot prices are now 12 cents a litre higher for the same time period while gasoline spots are that same 12 cents higher. The basic cost of heating and stove oils would now be unaffordable for lower income earners if it weren’t for one fact; the performance of the Canadian dollar. Consumers would be paying upwards of another 11 cents a litre more than what they are seeing now if the dollar had to hold the same value as last year. Any slide in the dollar now could cost the consumer this winter.
“The international situation remains volatile. If Turkey invades the Kurdish territories in Northern Iraq, we could see a disruption in crude supply. A lot of that comes to the US eastern seaboard, Eastern Canada and Europe. While there might be an ample supply right now, the promise of violence in a chief export area of Turkey may possibly turn into a worldwide supply disruption and that means rising pricing of all petroleum products. We still caution the consumer to fill the heating oil tanks in case we run into the world situation in the coming days.
-30-
For more information, contact;
George Murphy
Group researcher/Member
Monday, October 15, 2007
Consider filling the home heating tank
International events warrant consumer warning
News release
St. John’s, Newfoundland, October 15, 2007 – International events are prompting a warning from the Consumer Group for Fair Gas Prices to fill the home heating oil tanks. George Murphy is sounding the alarm as ongoing violence is putting upwards pressure on pricing of all petroleum products.
“The last few days on the international scene is telling me that we have bottomed out on any further decreases in pricing of heating and stove oil product. Draws on inventory in the United States along with the threats of more violence in Turkey and northern Iraq have led to an increase in all distillate products over the last couple of business days. That news is grim as renewed violence in northern Iraq along the Turkish border could possibly disrupt oil exports to the coast of Turkey”, said Murphy.
“The port of Ceyhan, Turkey handles most Iraq exports that come from the north of Iraq. The Mediterranean town handles almost 1.6 million barrels in exports in a day to North America and Europe and, if that is disrupted because of any possible outbreak of violence in Northern Turkey and Iraq, then we may see a huge increase in oil pricing. That momentum is continuing on the markets today. If all-out war breaks out between Turkey and the Kurds of Northern Iraq, it may be a case of “force majeure” in the markets.
“While prices are not showing an increase at this time, the rise in spot pricing is noticeable today and any further increase in spots in the next few days because of further violence or draws on inventory, may possibly signal increases at the next adjustment period. That and the onset of colder weather will mean we have already bottomed out in pricing and we’re looking at an upswing and rise from here on.”
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
International events warrant consumer warning
News release
St. John’s, Newfoundland, October 15, 2007 – International events are prompting a warning from the Consumer Group for Fair Gas Prices to fill the home heating oil tanks. George Murphy is sounding the alarm as ongoing violence is putting upwards pressure on pricing of all petroleum products.
“The last few days on the international scene is telling me that we have bottomed out on any further decreases in pricing of heating and stove oil product. Draws on inventory in the United States along with the threats of more violence in Turkey and northern Iraq have led to an increase in all distillate products over the last couple of business days. That news is grim as renewed violence in northern Iraq along the Turkish border could possibly disrupt oil exports to the coast of Turkey”, said Murphy.
“The port of Ceyhan, Turkey handles most Iraq exports that come from the north of Iraq. The Mediterranean town handles almost 1.6 million barrels in exports in a day to North America and Europe and, if that is disrupted because of any possible outbreak of violence in Northern Turkey and Iraq, then we may see a huge increase in oil pricing. That momentum is continuing on the markets today. If all-out war breaks out between Turkey and the Kurds of Northern Iraq, it may be a case of “force majeure” in the markets.
“While prices are not showing an increase at this time, the rise in spot pricing is noticeable today and any further increase in spots in the next few days because of further violence or draws on inventory, may possibly signal increases at the next adjustment period. That and the onset of colder weather will mean we have already bottomed out in pricing and we’re looking at an upswing and rise from here on.”
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
Tuesday, September 25, 2007
Heating oil continues to rise
Could be a long cold winter ahead
News release
St. John’s, NL, September 25, 2007- Consumers could face a long and cold winter this year if the Canadian dollar starts to falter in it’s rise against the US dollar. Heating oil spot prices are continuing to rise, in spite of gains that the Canadian dollar has made against the United States dollar, and that could prove to set the conditions for a long, cold winter for some, that’s according to George Murphy, group researcher and member of the Consumer Group for Fair Gas Prices.
Canadian dollar parity
“I’ve been watching the rise of the Canadian dollar and, while it may be good that it has increased and capped the rise in spot prices, any slip in the dollar will cost Canadian consumers dearly. We’re already looking at record spot prices for heating and stove oils for this same time as other years. Heating and stove oil spots range some 7 cents a litre higher than last year. We have yet to get into refinery maintenance season when refineries shut down to switch over to production of heating oils and other distillates. That will cause a draw against available inventory and possibly increase the product in value.
Thursday’s price adjustments
“Heating and stove oils are predicted to rise by close to 1.65 cents a litre this Thursday as the Petroleum Pricing Office will set new pricing for all petroleum products and gasoline is predicted to increase by close on 7/10ths of a cent per litre. That’s with thirteen days out of a possible fourteen reporting. We’ll have the true numbers tomorrow but there are indicators of where these numbers will head this week.
The Labrador effect
“Another fear is that we may end up seeing Labrador consumers pay record amounts for heating oil if spot pricing remains high for the next month and pricing gets locked in for the winter because of ice conditions. Labradorians could be looking at record pricing for heat. Traditionally, the movement of ice affects the flow of product into that region and petroleum products pricing is frozen until the spring when shipping season to Labrador is started again.
Effects of the rising dollar on consumers
“Consumers should be fearful at this juncture of the dollars’ rise because any slippage will mean the meteoric rise in spot pricing for product. Just to give everyone the sense of what could happen: If we were dealing with the dollar at the level it was two years ago, we would be looking at close to a dollar a litre for heating oils. If there is any time that the government should be supporting the dollar, it is at this juncture. Any collapse in the dollar now would be economically devastating to the consumer.
Government and taxation
“For a long time now, consumers have expressed their feelings of taxation levels on heat and it is this direct measure that government can address the rising costs of heat through the removal of all taxes off a basic necessity of life. Heat itself, may quickly become a health concern for a lot of people this winter should the dollar fall in value or spot pricing continue to rise.”
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Could be a long cold winter ahead
News release
St. John’s, NL, September 25, 2007- Consumers could face a long and cold winter this year if the Canadian dollar starts to falter in it’s rise against the US dollar. Heating oil spot prices are continuing to rise, in spite of gains that the Canadian dollar has made against the United States dollar, and that could prove to set the conditions for a long, cold winter for some, that’s according to George Murphy, group researcher and member of the Consumer Group for Fair Gas Prices.
Canadian dollar parity
“I’ve been watching the rise of the Canadian dollar and, while it may be good that it has increased and capped the rise in spot prices, any slip in the dollar will cost Canadian consumers dearly. We’re already looking at record spot prices for heating and stove oils for this same time as other years. Heating and stove oil spots range some 7 cents a litre higher than last year. We have yet to get into refinery maintenance season when refineries shut down to switch over to production of heating oils and other distillates. That will cause a draw against available inventory and possibly increase the product in value.
Thursday’s price adjustments
“Heating and stove oils are predicted to rise by close to 1.65 cents a litre this Thursday as the Petroleum Pricing Office will set new pricing for all petroleum products and gasoline is predicted to increase by close on 7/10ths of a cent per litre. That’s with thirteen days out of a possible fourteen reporting. We’ll have the true numbers tomorrow but there are indicators of where these numbers will head this week.
The Labrador effect
“Another fear is that we may end up seeing Labrador consumers pay record amounts for heating oil if spot pricing remains high for the next month and pricing gets locked in for the winter because of ice conditions. Labradorians could be looking at record pricing for heat. Traditionally, the movement of ice affects the flow of product into that region and petroleum products pricing is frozen until the spring when shipping season to Labrador is started again.
Effects of the rising dollar on consumers
“Consumers should be fearful at this juncture of the dollars’ rise because any slippage will mean the meteoric rise in spot pricing for product. Just to give everyone the sense of what could happen: If we were dealing with the dollar at the level it was two years ago, we would be looking at close to a dollar a litre for heating oils. If there is any time that the government should be supporting the dollar, it is at this juncture. Any collapse in the dollar now would be economically devastating to the consumer.
Government and taxation
“For a long time now, consumers have expressed their feelings of taxation levels on heat and it is this direct measure that government can address the rising costs of heat through the removal of all taxes off a basic necessity of life. Heat itself, may quickly become a health concern for a lot of people this winter should the dollar fall in value or spot pricing continue to rise.”
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For more information, contact;
George Murphy
Group researcher/member
Consumer Group for Fair Gas Prices
George Murphy
Group researcher/member
Consumer Group for Fair Gas Prices
Wednesday, September 19, 2007
The ramifications of $100 a barrel oil
Consumers and industry will take a huge hit
News release
St. John’s, NL, September 19, 2007 – Rising oil prices will have detrimental effects on consumers and industry if oil prices hit the $100 per barrel mark by the New Year, that’s according to George Murphy of the Consumer Group for Fair Gas prices.
“Already, I am noticing that heating oil pricing is 10 cents a litre higher than the same point last year and that could prove to be very costly to consumers this coming winter as pricing has continued to rise along with the price of a barrel of oil,” said Murphy. “If you haven’t heard of unaffordable heating oil pricing, it’s because we haven’t gotten into the winter heating season quite yet.”
“Spot pricing for all distillate fuels is up considerably and that could lead to higher transportation costs as we get further into the distillate season. We could become witness to increases in fuel costs to move goods and services and that means inflationary pricing to the average consumer. Market analysts are already predicting only a slight retreat in oil prices before we see $100 a barrel for oil. The oil industry will try to recoup those costs and that will mean higher pricing for all refined products including heating, stove, diesel and gasoline pricing.
“The only thing that is preventing a very sharp increase in pricing instead of the moderate increases we have been experiencing is the rise of the Canadian dollar against its US counterpart. If this were two years ago, we’d be looking at an added 25 cents onto these prices as they stand now. The ramifications of any slip in the Canadian dollar now are stark and staring at the consumer and industry too. A dollar a litre for heating fuel would be disastrous to the consumer out there.
Consumers and industry will take a huge hit
News release
St. John’s, NL, September 19, 2007 – Rising oil prices will have detrimental effects on consumers and industry if oil prices hit the $100 per barrel mark by the New Year, that’s according to George Murphy of the Consumer Group for Fair Gas prices.
“Already, I am noticing that heating oil pricing is 10 cents a litre higher than the same point last year and that could prove to be very costly to consumers this coming winter as pricing has continued to rise along with the price of a barrel of oil,” said Murphy. “If you haven’t heard of unaffordable heating oil pricing, it’s because we haven’t gotten into the winter heating season quite yet.”
“Spot pricing for all distillate fuels is up considerably and that could lead to higher transportation costs as we get further into the distillate season. We could become witness to increases in fuel costs to move goods and services and that means inflationary pricing to the average consumer. Market analysts are already predicting only a slight retreat in oil prices before we see $100 a barrel for oil. The oil industry will try to recoup those costs and that will mean higher pricing for all refined products including heating, stove, diesel and gasoline pricing.
“The only thing that is preventing a very sharp increase in pricing instead of the moderate increases we have been experiencing is the rise of the Canadian dollar against its US counterpart. If this were two years ago, we’d be looking at an added 25 cents onto these prices as they stand now. The ramifications of any slip in the Canadian dollar now are stark and staring at the consumer and industry too. A dollar a litre for heating fuel would be disastrous to the consumer out there.
“Government, on both levels, is going to have to look at a complete removal of the tax on heat as a measure to keep consumers warm this winter. I don’t think it’s good enough to see rebate programs put in place to take care of just a few people. We all are going to have to pick up the rising costs for higher oil so, why not make it across the board and country-wide?. Rising oil pricing may be good for the government treasury but when do we get our share?
“The fact that there may be consumers out there who will not be able to afford heating fuels this winter is fast becoming both a growing health concern and a financial burden to a lot of families. Industry, particularly the transportation sectors and the Newfoundland and Labrador fishery, will have to be able to adapt and deal with rising fuel costs as well as high dollar value and transportation issues. The rising costs of oil to electrical companies that generate electricity by burning oil will also have to recoup costs from the consumer as well. What are the side-effects of that on the people of Labrador?
“The fact that there may be consumers out there who will not be able to afford heating fuels this winter is fast becoming both a growing health concern and a financial burden to a lot of families. Industry, particularly the transportation sectors and the Newfoundland and Labrador fishery, will have to be able to adapt and deal with rising fuel costs as well as high dollar value and transportation issues. The rising costs of oil to electrical companies that generate electricity by burning oil will also have to recoup costs from the consumer as well. What are the side-effects of that on the people of Labrador?
“It’s still a little early to predict where this winters heating/stove oil season will be going this year but, so far, it does not look good. With pricing for heating oils already ten cents a litre higher than the same time last year and the promise of a rising oil price, the ramifications are obvious. In spite of recent builds in distillate inventories ahead of refinery maintenance season, there is a distinct possibility this time around that we could see pricing well over last years numbers. The only thing that could stop what will happen is recession and, I’m thinking we’re close to the edge of that now.”
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For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Tuesday, September 11, 2007
Gasoline prices to stay steady
Heating and stove oils to increase
Heating and stove oils to increase
News release
St. John’s, NL, September 11, 2007 – Consumers in Newfoundland and Labrador will not see any major increase in gasoline pricing but users of heating and stove oils are advised to get ready for increases. The Consumer Group for Fair Gas Prices is advising home owners and users of distillates like heating and stove oils to get ready for increases in their respective products.
“Gasoline numbers are showing a modest two tenths of a cent increase while heating and stove oil users will be looking at close to 2.3 cents a litre up this coming Thursday morning. Those numbers are with twelve out of fourteen available data days,” said George Murphy, group researcher and member of the Consumer Group for Fair Gas Prices.
“This is the time of year where the focus has switched from gasoline to users of distillates like heating and stove oils. Even jet fuels are showing added demand and that may add to future increases as that fuel is added as an antifreeze agent during winter months. We’re advising consumers to shop around this heating season. Some companies offer insurances and maintenance programs that rival other companies but pricing of heating and stove oils can vary greatly and that’s where the consumer can win big.
“Gasoline spots are showing a difference of eight cents a litre against last year while heating/stove oil numbers are six cents a litre higher. That could mean trouble if we don’t see a build in distillates before the weather turns colder. I think that consumers are probably a little more concerned with the costs of heat as heat is a health concern unlike gasoline.
***Note to readers: As of the 12th, I have numbers that show an allowable increase in heating and stove oils by 2.62 cents a litre while gasoline shows an allowable increase of 15/100ths of a cent, not including the tax component.That's based on 14 out of the possible 14 busines days that are available. Unknown as to why the Public Utilities Board numbers are so far out of whack with mine.
I'll still stand by mine however!
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Editors: Please note the change in contact information.
For more information, contact;
George Murphy
Group researcher/MemberConsumer Group for Fair Gas Prices
Tuesday, August 21, 2007
Hurricane Dean spares the Gulf-So far
News release
St. John's, NL, August 21, 2007- Hurricane Dean has spared consumers in most areas the inconvenience of skyrocketting prices as it hit the Yucatan Peninsula earlier this morning. Early last week, projections from the National Hurricane center showed Dean making a direct track to the Gulf of Mexico and its crude production and refining facilities.
"We're lucky in some aspects here that Dean managed to turn to a more direct westerly direction rather than hit the chief production and refining centers on the Texas-Louisianna border. Last week showed a different scenario when Dean was foreecast to throw itself on the US gulf coast," said George Murphy, group researcher and member of the Consumer Group for Fair Gas Prices.
"We expected that spot pricing would have risen to unbearable levels as they did with Katrina had the hurricane hit directly in the center of the gulf coast but that didn't happen. While some production on the Mexico side of the Gulf may occur, that shouldn't do anything major to gasoline pricing. We may likely see an increase to crude as overall Mexican production will be affected but that shouldn't bight into consumers pocketbooks.
"In Newfoundland and Labrador where pricing is regulated, numbers show only a 3 cent a litre allowable at the pump level and that is expected to moderate somewhat now that Dean has done a complete swing-around in direction.Already, spots have begun to decline again and the likelihood of any "early interruption" in pricing has passed with that. Four cents is needed for any interruption in pricing to occur and that's not going to happen now, according to the numbers I have.
"We're all just praying now that there is going to be no loss of life in Mexico as this brutal storm passes over the Yucatan Peninsula. Dean is forecast to regain some strength as it re-enters the Gulf sometime late today. Crude oil production has been halted at Cantarell, the worlds third largest field in the world as a result of Dean's track and some 14,000 oil workers have been evacuated."
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For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
(709)685-6186 cellular
Tuesday, August 14, 2007
Something wicked this trading day comes
Guess what?..
While you slept last night, a concerted effort to increase spot pricing for gasoline occurred in the markets. Gasoline spots increased by more than 20 cents a US gallon.
That's about 5.5 cents a litre to Canadian consumers translated at the pumps.
Yes...Hurricane Syndrome has set in and there's not a darn thing to be done about it on this side of the border.
Consumers should now be aware that we have entered that "revered" time of the year where corporate rape of consumers occurs on a whim. Data from the National Hurricane Center in the US indicates today that tropical depression number four, soon to be named Dean if it reaches hurricane status, will likely become a tropical storm later today.
Consumers would be advised to keep the tanks filed up but practise conservation methods while these storms are around. When an actual storm is more than likely to damage any oil production or refining facility, the consumer is better off waiting the economic storm out and go with what they already have in the tank. Hoarding the stuff only caused undue grief to other consumers and sucessfully drives up the price of gasoline and someone besides youmakes a fortune.
So, while these storms are around this hurricane season, take some of this practcal advice and help take a financial bite out of the people who like to take a financial bite out of you. If a storm hits, you should have had full tanks already. Buying after the storm hits only puts bigger dollars out in the other fella's pockets.
Regards,
George Murphy
Tuesday, July 24, 2007
Hold off at the pumps!
Numbers show prices will drop Thursday morning
Numbers show prices will drop Thursday morning
News release
Paradise, NL, July 24, 2007- OPEC is talking about increasing production and gasoline spot prices have continued to drop over the last week. This means a possible break at the pumps to consumers this coming Thursday, according to George Murphy of the Consumer Group for Fair Gas Prices.
Expect a drop
“My numbers are showing that for six days out of seven needed for the interrupter formula to kick in so far; pricing is forecast to drop by 4.2 cents per litre on gasoline inclusive of taxes. No drop to other fuels is expected according to my records. To use the interrupter formula to increase or lower prices, we need to see a movement of four cents either way in the markets over seven days, not inclusive of taxes. My numbers show a 3.7 cent a litre drop and that’s within my margin of error of 3/10ths of a cent so, I’m calling the shot on this one. It’s the break to consumers that we’ve been expecting and initially told of last week when pricing was last adjusted. Tuesday’s trading day remains key if we are to see that drop but, gasoline is again trading down today. Expect a break Thursday morning. If it doesn’t, it’s a certainty that we’ll see a drop in prices next wee,” said Murphy.
Refineries pick up output
“Refiner capacity is showing increased growth and inventories are substantial enough now that, at this juncture of the driving season, concerns should be coming off that fuel and its consumption level. Forecasters of this weeks inventory report expect an increase in refiner capacity and that means more product out there on the markets. If that happens, the drops may keep coming barring any unforeseen circumstance like terrorism or hurricanes. I believe that last week was also key when we passed the half-way point of the summer driving season and there wasn’t a huge impact on overall gasoline inventory.
OPEC to pick up production?
“OPEC has expressed some concern over the high price of crude recently and that has sparked a slight sell-off in the markets as traders look at a possible OPEC production increase. That should bring some relief to heating oil users as the heavy oils that OPEC sells the most of, is directly linked to the heavier type fuels like jet, heating and stove oils. If they increase output, then we may see some upwards pressure taken off those fuels. We still haven’t seen those prices drop as we did in other summer seasons. OPEC members will meet, ironically, September 11th in Vienna, Austria.
Hurricane Syndrome remains a factor
Still lurking in the markets is the simple fact that we have gone almost halfway through the Atlantic hurricane season and we still have no hurricanes in our midst. Memories linger with all consumers when prices hit their epoch on Canada and elsewhere as almost 10 per cent of United States production and refining was affected. Traders will no doubt wing prices higher to consumers if hurricanes are forecast to hit any coastal region where production may be affected. While pricing will be pointing down in the next little while as driving season wanes, expect those same traders to use “Hurricane Syndrome” as an excuse to increase pricing at the pumps at anytime.”
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For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Paradise, NL, July 24, 2007- OPEC is talking about increasing production and gasoline spot prices have continued to drop over the last week. This means a possible break at the pumps to consumers this coming Thursday, according to George Murphy of the Consumer Group for Fair Gas Prices.
Expect a drop
“My numbers are showing that for six days out of seven needed for the interrupter formula to kick in so far; pricing is forecast to drop by 4.2 cents per litre on gasoline inclusive of taxes. No drop to other fuels is expected according to my records. To use the interrupter formula to increase or lower prices, we need to see a movement of four cents either way in the markets over seven days, not inclusive of taxes. My numbers show a 3.7 cent a litre drop and that’s within my margin of error of 3/10ths of a cent so, I’m calling the shot on this one. It’s the break to consumers that we’ve been expecting and initially told of last week when pricing was last adjusted. Tuesday’s trading day remains key if we are to see that drop but, gasoline is again trading down today. Expect a break Thursday morning. If it doesn’t, it’s a certainty that we’ll see a drop in prices next wee,” said Murphy.
Refineries pick up output
“Refiner capacity is showing increased growth and inventories are substantial enough now that, at this juncture of the driving season, concerns should be coming off that fuel and its consumption level. Forecasters of this weeks inventory report expect an increase in refiner capacity and that means more product out there on the markets. If that happens, the drops may keep coming barring any unforeseen circumstance like terrorism or hurricanes. I believe that last week was also key when we passed the half-way point of the summer driving season and there wasn’t a huge impact on overall gasoline inventory.
OPEC to pick up production?
“OPEC has expressed some concern over the high price of crude recently and that has sparked a slight sell-off in the markets as traders look at a possible OPEC production increase. That should bring some relief to heating oil users as the heavy oils that OPEC sells the most of, is directly linked to the heavier type fuels like jet, heating and stove oils. If they increase output, then we may see some upwards pressure taken off those fuels. We still haven’t seen those prices drop as we did in other summer seasons. OPEC members will meet, ironically, September 11th in Vienna, Austria.
Hurricane Syndrome remains a factor
Still lurking in the markets is the simple fact that we have gone almost halfway through the Atlantic hurricane season and we still have no hurricanes in our midst. Memories linger with all consumers when prices hit their epoch on Canada and elsewhere as almost 10 per cent of United States production and refining was affected. Traders will no doubt wing prices higher to consumers if hurricanes are forecast to hit any coastal region where production may be affected. While pricing will be pointing down in the next little while as driving season wanes, expect those same traders to use “Hurricane Syndrome” as an excuse to increase pricing at the pumps at anytime.”
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For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Tuesday, July 17, 2007
Crossing the threshold
Gasoline to drop slightly as mid-summer passes
News release
Paradise, NL, July 17, 2007- Gasoline prices are set to drop slightly this coming Thursday as market trading showed slight decreases in spot pricing for the past two weeks, that’s according to George Murphy of the Consumer Group for Fair Gas Prices.
Coming drops in pricing
“After 13 days out of a possible 14 days recorded, numbers are showing that gasoline should drop by 8/10ths of a cent per litre. Stove and heating oils are showing only a minimal change of 34/100ths downwards and that should be a concern as distillate demand remains strong ahead of winter, particularly for diesel. We’ve hit the balancing point in the markets where, I believe that traders will soon change focus on what fuel is going to be more valuable at the end of the driving season. My belief is that the focus will turn to the distillates shortly,” said Murphy.
Market traders deserve scrutiny
“Looks like we’ve hit mid-summer and surely to God, the market traders south of the border have to realize that fact. The focus has to come off gasoline as the summer driving season wanes. We haven’t seen further degrading of gasoline inventories and any drawdown shouldn’t adversely affect the rest of the driving season. If the markets don’t tune to this fact shortly, then consumers should be upset and the governments that look after us should be as well.
Pricing to moderate some
“We dodged a very big bullet this time around on pricing. While we did see a new record with gasoline pricing, I believe that there has to be a turnaround happening shortly. The last two market trading days may be a signal of more to come as regards to a downwards trend but there are still some important factors that remain for consumers to contend with.
Iran and its pursuit of a nuclear program against the threats of United Nations sanctioning, Nigeria, and the ongoing situation in Iraq still remain as key factors.
Also in the wings is a threat of a production interruption in oil fields in the North Sea that hit Brent crudes hard this week.
Hurricane threat remains
“Still to play out in the markets this summer however, is what I like to call “Hurricane Syndrome”. That’s where the markets have the tendency to “panic” when they see a storm brewing a thousand miles away from unloading and processing facilities. No doubt the consumers’ interests will be tested by traders who stand to make a heavy dollar on that speculation.
We’re asking our governments to keep a watchful eye to the markets while hurricane season is upon us and get proof of the rip-off the consumers have to contend with at this time of the year. We’re not out of the woods there but concerns over available inventory to carry consumers through the heavy summer driving season should be dissipating and be reflected in pricing to the consumer.
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Note: When I sent this one out, I didn't have the pivotal fourteenth day. With that day included, gasoline now shows a drop of somewhere around 1.3 a litre while stove and heating will drop by 49/100ths of a cent.
From the looks of the markets, if this down trend continues, expect to see early interruption next week. Numbers traded down almost 5.4 cents a litre not including taxes for yesterday, July 17th.
Here's hoping!...
For more information, contact;
George Murphy
Group researcher/MemberConsumer Group for Fair Gas Prices
Gasoline to drop slightly as mid-summer passes
News release
Paradise, NL, July 17, 2007- Gasoline prices are set to drop slightly this coming Thursday as market trading showed slight decreases in spot pricing for the past two weeks, that’s according to George Murphy of the Consumer Group for Fair Gas Prices.
Coming drops in pricing
“After 13 days out of a possible 14 days recorded, numbers are showing that gasoline should drop by 8/10ths of a cent per litre. Stove and heating oils are showing only a minimal change of 34/100ths downwards and that should be a concern as distillate demand remains strong ahead of winter, particularly for diesel. We’ve hit the balancing point in the markets where, I believe that traders will soon change focus on what fuel is going to be more valuable at the end of the driving season. My belief is that the focus will turn to the distillates shortly,” said Murphy.
Market traders deserve scrutiny
“Looks like we’ve hit mid-summer and surely to God, the market traders south of the border have to realize that fact. The focus has to come off gasoline as the summer driving season wanes. We haven’t seen further degrading of gasoline inventories and any drawdown shouldn’t adversely affect the rest of the driving season. If the markets don’t tune to this fact shortly, then consumers should be upset and the governments that look after us should be as well.
Pricing to moderate some
“We dodged a very big bullet this time around on pricing. While we did see a new record with gasoline pricing, I believe that there has to be a turnaround happening shortly. The last two market trading days may be a signal of more to come as regards to a downwards trend but there are still some important factors that remain for consumers to contend with.
Iran and its pursuit of a nuclear program against the threats of United Nations sanctioning, Nigeria, and the ongoing situation in Iraq still remain as key factors.
Also in the wings is a threat of a production interruption in oil fields in the North Sea that hit Brent crudes hard this week.
Hurricane threat remains
“Still to play out in the markets this summer however, is what I like to call “Hurricane Syndrome”. That’s where the markets have the tendency to “panic” when they see a storm brewing a thousand miles away from unloading and processing facilities. No doubt the consumers’ interests will be tested by traders who stand to make a heavy dollar on that speculation.
We’re asking our governments to keep a watchful eye to the markets while hurricane season is upon us and get proof of the rip-off the consumers have to contend with at this time of the year. We’re not out of the woods there but concerns over available inventory to carry consumers through the heavy summer driving season should be dissipating and be reflected in pricing to the consumer.
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Note: When I sent this one out, I didn't have the pivotal fourteenth day. With that day included, gasoline now shows a drop of somewhere around 1.3 a litre while stove and heating will drop by 49/100ths of a cent.
From the looks of the markets, if this down trend continues, expect to see early interruption next week. Numbers traded down almost 5.4 cents a litre not including taxes for yesterday, July 17th.
Here's hoping!...
For more information, contact;
George Murphy
Group researcher/MemberConsumer Group for Fair Gas Prices
Crossing the threshold
Gasoline to drop slightly as mid-summer passes
News release
Paradise, NL, July 17, 2007- Gasoline prices are set to drop slightly this coming Thursday as market trading showed slight decreases in spot pricing for the past two weeks, that’s according to George Murphy of the Consumer Group for Fair Gas Prices.
Coming drops in pricing
“After 13 days out of a possible 14 days recorded, numbers are showing that gasoline should drop by 8/10ths of a cent per litre. Stove and heating oils are showing only a minimal change of 34/100ths downwards and that should be a concern as distillate demand remains strong ahead of winter, particularly for diesel. We’ve hit the balancing point in the markets where, I believe that traders will soon change focus on what fuel is going to be more valuable at the end of the driving season. My belief is that the focus will turn to the distillates shortly,” said Murphy.
Market traders deserve scrutiny
“Looks like we’ve hit mid-summer and surely to God, the market traders south of the border have to realize that fact. The focus has to come off gasoline as the summer driving season wanes. We haven’t seen further degrading of gasoline inventories and any drawdown shouldn’t adversely affect the rest of the driving season. If the markets don’t tune to this fact shortly, then consumers should be upset and the governments that look after us should be as well.
Pricing to moderate some
“We dodged a very big bullet this time around on pricing. While we did see a new record with gasoline pricing, I believe that there has to be a turnaround happening shortly. The last two market trading days may be a signal of more to come as regards to a downwards trend but there are still some important factors that remain for consumers to contend with.
Iran and its pursuit of a nuclear program against the threats of United Nations sanctioning, Nigeria, and the ongoing situation in Iraq still remain as key factors.
Also in the wings is a threat of a production interruption in oil fields in the North Sea that hit Brent crudes hard this week.
Hurricane threat remains
“Still to play out in the markets this summer however, is what I like to call “Hurricane Syndrome”. That’s where the markets have the tendency to “panic” when they see a storm brewing a thousand miles away from unloading and processing facilities. No doubt the consumers’ interests will be tested by traders who stand to make a heavy dollar on that speculation.
We’re asking our governments to keep a watchful eye to the markets while hurricane season is upon us and get proof of the rip-off the consumers have to contend with at this time of the year. We’re not out of the woods there but concerns over available inventory to carry consumers through the heavy summer driving season should be dissipating and be reflected in pricing to the consumer.
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For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Gasoline to drop slightly as mid-summer passes
News release
Paradise, NL, July 17, 2007- Gasoline prices are set to drop slightly this coming Thursday as market trading showed slight decreases in spot pricing for the past two weeks, that’s according to George Murphy of the Consumer Group for Fair Gas Prices.
Coming drops in pricing
“After 13 days out of a possible 14 days recorded, numbers are showing that gasoline should drop by 8/10ths of a cent per litre. Stove and heating oils are showing only a minimal change of 34/100ths downwards and that should be a concern as distillate demand remains strong ahead of winter, particularly for diesel. We’ve hit the balancing point in the markets where, I believe that traders will soon change focus on what fuel is going to be more valuable at the end of the driving season. My belief is that the focus will turn to the distillates shortly,” said Murphy.
Market traders deserve scrutiny
“Looks like we’ve hit mid-summer and surely to God, the market traders south of the border have to realize that fact. The focus has to come off gasoline as the summer driving season wanes. We haven’t seen further degrading of gasoline inventories and any drawdown shouldn’t adversely affect the rest of the driving season. If the markets don’t tune to this fact shortly, then consumers should be upset and the governments that look after us should be as well.
Pricing to moderate some
“We dodged a very big bullet this time around on pricing. While we did see a new record with gasoline pricing, I believe that there has to be a turnaround happening shortly. The last two market trading days may be a signal of more to come as regards to a downwards trend but there are still some important factors that remain for consumers to contend with.
Iran and its pursuit of a nuclear program against the threats of United Nations sanctioning, Nigeria, and the ongoing situation in Iraq still remain as key factors.
Also in the wings is a threat of a production interruption in oil fields in the North Sea that hit Brent crudes hard this week.
Hurricane threat remains
“Still to play out in the markets this summer however, is what I like to call “Hurricane Syndrome”. That’s where the markets have the tendency to “panic” when they see a storm brewing a thousand miles away from unloading and processing facilities. No doubt the consumers’ interests will be tested by traders who stand to make a heavy dollar on that speculation.
We’re asking our governments to keep a watchful eye to the markets while hurricane season is upon us and get proof of the rip-off the consumers have to contend with at this time of the year. We’re not out of the woods there but concerns over available inventory to carry consumers through the heavy summer driving season should be dissipating and be reflected in pricing to the consumer.
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For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Tuesday, July 03, 2007
More increases on the way
Gasoline, stove and heating oil pricing to increase Thursday
News release
Paradise, NL, July 3, 2007- Consumers in Newfoundland and Labrador will get tagged with another round of increases this week as demand for gasoline and diesel fuels pick up for the summer driving season.
“Consumers can expect to see an added 2.2 cents per litre on gasoline and an added 2.92 cents per litre on stove and heating oils. That’s with 13 days out of a possible 14 days to report from. I don’t expect too much change from those numbers after today’s market trading,” said George Murphy, group researcher and member of the Consumer Group for Fair Gas Prices.
“A drop in gasoline inventories along with a drop in refiner capacity has complicated the pricing problem, but what was totally unexpected is the fact that stove and heating oil users will be looking at a considerable increase at the pumps this week. This is the time of year when we see those expected builds in distillate inventories. Last weeks numbers from the Energy Information Administration in the United States showed a considerable drawdown on stocks.
“We’re roughly at a level we were last year on both fuels. My records indicate that the next two weeks will be critical in seeing pricing stay at its present level. Last year saw a rapid increase in spot pricing of gasoline immediately following the July 1st and July 4th celebrations in Canada and the United States. That’s when the heat comes on gasoline spots and people start vacations. If we hear of increases in refinery capacity and its associated pickup in production of gasoline, we could dodge another increase, but right now that’s up in the air. We’ve already hit that range of $1.22 to $1.31 a litre and we could easily hit it again.”
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For more information, contact;
George Murphy
Group researcher/member
Consumer Group for Fair Gas Prices
Gasoline, stove and heating oil pricing to increase Thursday
News release
Paradise, NL, July 3, 2007- Consumers in Newfoundland and Labrador will get tagged with another round of increases this week as demand for gasoline and diesel fuels pick up for the summer driving season.
“Consumers can expect to see an added 2.2 cents per litre on gasoline and an added 2.92 cents per litre on stove and heating oils. That’s with 13 days out of a possible 14 days to report from. I don’t expect too much change from those numbers after today’s market trading,” said George Murphy, group researcher and member of the Consumer Group for Fair Gas Prices.
“A drop in gasoline inventories along with a drop in refiner capacity has complicated the pricing problem, but what was totally unexpected is the fact that stove and heating oil users will be looking at a considerable increase at the pumps this week. This is the time of year when we see those expected builds in distillate inventories. Last weeks numbers from the Energy Information Administration in the United States showed a considerable drawdown on stocks.
“We’re roughly at a level we were last year on both fuels. My records indicate that the next two weeks will be critical in seeing pricing stay at its present level. Last year saw a rapid increase in spot pricing of gasoline immediately following the July 1st and July 4th celebrations in Canada and the United States. That’s when the heat comes on gasoline spots and people start vacations. If we hear of increases in refinery capacity and its associated pickup in production of gasoline, we could dodge another increase, but right now that’s up in the air. We’ve already hit that range of $1.22 to $1.31 a litre and we could easily hit it again.”
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For more information, contact;
George Murphy
Group researcher/member
Consumer Group for Fair Gas Prices
Tuesday, June 19, 2007
Gasoline prices to drop
Drop in refiner capacity makes consumers pay
News release
Paradise, NL, June 19, 2007- Gasoline will come a little cheaper for consumers in Newfoundland and Labrador this week as prices are forecast to drop by a rough 3.3 cents a litre with 13 days out of 14 to report from, that’s according to George Murphy of the Consumer Group for Fair Gas Prices. Heating and stove oils are showing an increase of close to 6/10ths of a cent over the same time period.
“A look at the numbers from last weeks inventory data shows that Big Oil is making consumers pay for their past folly. We’ve seen Big Oil pay out big money to shareholders rather than make the strategic investments in refineries maintenance. Every time we see a refinery outage, we see the fruits of that. If refiner capacity drops against consumer demand, they still win,” said Murphy.
“Right now, Big Oil is heavily dependent upon foreign imports of refined product. That will be a strategic mistake to the consumer if demand picks up in other centres where this refined product is coming from. If the markets lose these imports to the North American market, we could see some sharp rises in pricing to the consumer. Because they’re not refining enough to keep up with demand and relying heavily on imports, we’ve effectively seen the creation of a ‘house of cards’ on the markets that the consumer could end up paying for in the end.
“Refinery capacity dropped in an Energy Information Administration report from last week. Numbers last week showed that capacity dropped in the gasoline demand period to fall to 89.2 per cent. While the same report showed a very modest growth in gasoline inventory, the numbers remained very bullish to traders. Numbers for the rest of the regulation period started to trade up again erasing some of last weeks predicted five cent drop at the pumps that should have happened.
“What is odd with the increase on heating and stove oils is that demand for distillates has increased over the same period last year. I’m still worried that there is going to be a sustained increase in heating and stove oils this winter if Big Oil doesn’t address refining problems. We’re still not seeing big increases in inventories of that fuel group, nor are we seeing drops in the cost price of those fuels. Spots are a rough two cents over what they were for the same timeframe last year.”
“People should be concerned that numbers for heating and stove oils aren’t backing down the way they normally would. This is the time of year that we’ve seen those figures back down but they aren’t. If this keeps up and nothing changes, we’ll be back into relief programs for those who can’t afford to pay for heat again and governments will be forced to act in response to Big Oil’s folly. We’re getting too dependent upon foreign imports to catch us when the markets are failing us.”
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For more information, contact;
George Murphy
Group researcher/Member
Thursday, June 14, 2007
Standing by my numbers
Prices should have dropped to consumers-PPO needs to explain
News release
Paradise, NL, June 14, 2007- “Pricing to consumers in Newfoundland and Labrador should have come down and the Petroleum Pricing Office needs to explain why they never,” according to George Murphy, group researcher and member of the Consumer Group for Fair Gas prices.
“I know my numbers were solid this time around. Numbers from the markets after weekend trading showed a solid 4.37 cents a litre down (5.0/Litre taxes in) and they held that trend right up to Tuesday trading close. Markets showed a 5.1 cent a litre drop coming then. I know my numbers were right and I’ll stand by them. Consumers should be looking at five cents a litre down this morning but they aren’t. My numbers fall well within the requirement of four cents a litre up or down in movement for the interrupter formula to work,” said Murphy.
“Other centers like Nova Scotia and New Brunswick saw pricing drop well below what we have here and that’s now all out of sync. Traditionally, what I have noticed was that we would follow in price drops and be close to what pricing would be in those provinces. If they’re using New York Mercantile Exchange numbers, then there is something wrong here. All three of my sources can’t be wrong.
“The last three price changes were just about dead on. Two weeks ago showed they were dead accurate while last week’s price change was out by 2/10ths of a cent. I work on a margin of error of 3/10ths. My numbers exceeded that this week, enough to show interruption and that resulted in the predicted drop coming at the pumps. Rather than miss this one by three tenths, I must have missed this one by a couple of extra hundredths. Frankly, I’m disappointed that the companies just didn’t drop prices ahead of schedule while the impetus is there. If there is any good news it’s that we’re still on track for a 5.1 cent a litre drop next week with eight days out of a possible 14 recorded.”
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For more information, contact;
George Murphy
Consumer Group for Fair Gas prices
Tuesday, June 12, 2007
Go light on the golden stuff
Gasoline to drop this coming Thursday if the numbers hold today
News release
Paradise, NL, June 12, 2007- Unless there is a drastic increase in the price of gasoline in the markets today, it is likely that consumers will catch another break at the pumps as the Petroleum Pricing Office will have to use their interrupter formula, that’s according to George Murphy of the Consumer Group for Fair Gas Prices.
“Good builds in gasoline inventories over the past three weeks have taken some of the early worries on high summer pricing out of the markets, at least for this week and that is going to translate into a five cent drop at the pumps this coming Thursday morning if the numbers hold so, word here is ‘go light on the gold stuff’,” Murphy said.
“This interruption will bring our spot pricing average down towards the 60 cent a litre basic cost price for gasoline. Gasoline pricing in the markets will have to trade at 65 cents a litre today for any decrease not to happen. This decrease is representative of what Big Oil has seen in the markets; consumers hitting that brick wall on pricing. Demand didn’t show any strong increase to match what was being added to inventories. Demand numbers showed a 1.5 per cent increase against last years’ numbers, a number that showed some weakening against the inventory build.
“While we have already hit a new all-time record on pricing, it doesn’t mean that we’ll see continued drops in pricing. We could see a reversal of this downwards trend as people start their summer vacations. We’re not ready to ease back on warnings of record pricing this summer quite yet although any continued build in inventories would be of benefit to the consumer. If prices drop this week, it would bring pricing down to levels last seen a year ago. That still is reflective of the predicted pricing range that we’ve hit once already.”
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
(709)782-8053
(709)685-6186 cellular
Gasoline to drop this coming Thursday if the numbers hold today
News release
Paradise, NL, June 12, 2007- Unless there is a drastic increase in the price of gasoline in the markets today, it is likely that consumers will catch another break at the pumps as the Petroleum Pricing Office will have to use their interrupter formula, that’s according to George Murphy of the Consumer Group for Fair Gas Prices.
“Good builds in gasoline inventories over the past three weeks have taken some of the early worries on high summer pricing out of the markets, at least for this week and that is going to translate into a five cent drop at the pumps this coming Thursday morning if the numbers hold so, word here is ‘go light on the gold stuff’,” Murphy said.
“This interruption will bring our spot pricing average down towards the 60 cent a litre basic cost price for gasoline. Gasoline pricing in the markets will have to trade at 65 cents a litre today for any decrease not to happen. This decrease is representative of what Big Oil has seen in the markets; consumers hitting that brick wall on pricing. Demand didn’t show any strong increase to match what was being added to inventories. Demand numbers showed a 1.5 per cent increase against last years’ numbers, a number that showed some weakening against the inventory build.
“While we have already hit a new all-time record on pricing, it doesn’t mean that we’ll see continued drops in pricing. We could see a reversal of this downwards trend as people start their summer vacations. We’re not ready to ease back on warnings of record pricing this summer quite yet although any continued build in inventories would be of benefit to the consumer. If prices drop this week, it would bring pricing down to levels last seen a year ago. That still is reflective of the predicted pricing range that we’ve hit once already.”
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
(709)782-8053
(709)685-6186 cellular
Saturday, June 09, 2007
This could get interesting...
Gasoline to drop...Again?...
Call it what you will, but the fact that U.S interest rates are on the rise just might be of benefit to consumers here in Newfoundland and Labrador this week and possibly other gasoline users in other provinces.
Why?
U.S interest rates are rising because demand for some consumables is dropping. If that happens, as in all likelihood they are, then it may be a sign that inflation is increasing. If that is so, then watchers are predicting a drop in demand of petroleum products.
Of course, a good build in gasoline inventories this week also did its little part in bringing this about.
So far, with five out of a possible seven days data available, it looks like Newfoundland and Labrador consumers are looking at a possible drop at the pumps of a nickel. Could be more than that if Monday and Tuesdays' trading days also figure lower.
Be warned of a possible price drop this week...That's a change isn't it?...
Thought so.
Go light on the liquid gold for now. I'll have more in a release sometime on Tuesday to all the media in our neck of the woods.
Regards,
George
Saturday, June 02, 2007
Still pointing "down"
After twelve days out of a possible 14, gasoline pricing is still projected to show a modest drop to Newfoundland and Labrador consumers.
A moderately good inventory report from the Energy Information Administration in the United States this week shows that, while refiner capacity may not have increased, inventories of gasoline showed a slight increase for the second week in a row. Hopefully, this coming Wednesday's report will show a third consecutive.
A "brick wall" has been hit this last couple of weks it seems. Maybe consumers are finally getting the conservation message and maybe they've come to realize that the prices they were seeing at the pumps simply weren't justified under any conditions.
What you did see the past couple of weeks was the realisation that inventory shortfalls and refiner capacity have come into question and they both remain as proof of the oil companies will to manipulate supply and demand. Because they've cut back on the number of operating refineries, they can't produce what the market needs. Because they didn't sink money into refinery maintenance, any shutdown only added to the upwards spurt in gasoline and heating oil spot prices.
Either way, for Big Oil, it's "win-win".
Anyways, if you're in Newfoundland and Labrador, so far we're looking at 3.8 cents a litre down at the pumps with two business days to go. Heating oils and stove oils both show a rough half cent down.
Here's hopin'!...
Regards,
George
Thursday, May 31, 2007
Attention Newfoundland and Labrador!
All areas to see a drop in prices
When prices are adjusted next week to pricing for Newfoundland and Labrador consumers, we should catch a break at the pumps.
So far, as of yesterdays market close, we're looking at 2.8 cents a litre. If the trend continues, it should be something more than that.
Nova Scotia and New Brunswick consumers should get to see the benefits of the drop this coming Friday.
Take notice and spread the word to hold off on consumption, or, at least buy in some moderation until these drops hit. Looks like the consumer out there may have hit the brick wall on pricing.
I'll have more on this to come.
Monday, May 28, 2007
“Drop gasoline taxes to aid tourism industry,” says consumer group
News release
Paradise, NL, May 28, 2007 – The provincial government should drop a portion of gasoline taxes in the province as an incentive to improve the tourism industry. A cut in the tax would be beneficial to Newfoundland and Labrador residents and those from out of province who see high gasoline pricing as a potential barrier to making the province a vacation destination this year.
“We know that gasoline pricing is high and is expected to stay that way for the rest of the summer but, besides governments’ strategic investments in advertising, it needs to give a financial incentive to consumers who they hope to draw to rural areas to spend some vacation money. Government has to be seen to be doing something for us as vacationers and for those who could potentially want to visit us,” said George Murphy, group researcher and member of the Consumer Group for Fair Gas Prices.
“Last year, we made the call to drop some of the taxes on gasoline. Government said at the time, that they couldn’t. Their reasoning was that high pricing led to a drop in consumption and that meant less taxes collected. Contrary to what government said at the time, that’s not how it worked out. Last year, government collected $145 million, well up from the $142.5 collected in the year previous. This year, they are projecting nearly $147 million to be raised through gasoline taxes. Past numbers alone prove that people still had to buy gasoline, although the price was still high. They just didn’t go out of their way to visit as in other years.
“The increase in tourism numbers for the St. John’s area showed that there was more airline traffic into the city. Tourism numbers were up slightly in the St. John’s and surrounding area last year, but rural areas suffered a different fate. Rural areas didn’t have that same advantage and we need to give them a fighting chance at getting tourism revenue up. We also need to give the Newfoundland and Labradorian tourist the incentive to stay at home; give them a chance to explore our own province.
“Numbers were down from years previous by a few percentage points. Last year, we saw a sharp upwards increase in pricing that peaked during the first week of July. This year, they’ve hit last year’s numbers already. Pricing is expected to stay higher and for a longer time this summer. That could mean trouble for everyone and we’ll need to depend more on our own people to support our rural tourism markets.
“I think that consumers here already recognize the need for road and bridge work. We also have heard that government is intent on spending a “record” $66 million on roads and related infrastructure, a far cry from the money they have collected in the past from gasoline and other motive taxes. We’re not asking for much besides recognition from government that we have problem with high pricing. A cut of some four cents on a litre in gasoline taxes for the summer is not an unreasonable amount to ask for. What it symbolizes is that recognition, that as tourists and consumers, we are made to feel that we’re welcome at home too.”
-30-
For more information, contact;
George Murphy
Group researcher/ Member
Consumer Group for Fair Gas Prices
(709)782-8053
(709)685-6186 cellular
My blog: www.gasandoil.blogspot.com
Email: gasprices@hotmail.com, gasprices@nl.rogers.com
News release
Paradise, NL, May 28, 2007 – The provincial government should drop a portion of gasoline taxes in the province as an incentive to improve the tourism industry. A cut in the tax would be beneficial to Newfoundland and Labrador residents and those from out of province who see high gasoline pricing as a potential barrier to making the province a vacation destination this year.
“We know that gasoline pricing is high and is expected to stay that way for the rest of the summer but, besides governments’ strategic investments in advertising, it needs to give a financial incentive to consumers who they hope to draw to rural areas to spend some vacation money. Government has to be seen to be doing something for us as vacationers and for those who could potentially want to visit us,” said George Murphy, group researcher and member of the Consumer Group for Fair Gas Prices.
“Last year, we made the call to drop some of the taxes on gasoline. Government said at the time, that they couldn’t. Their reasoning was that high pricing led to a drop in consumption and that meant less taxes collected. Contrary to what government said at the time, that’s not how it worked out. Last year, government collected $145 million, well up from the $142.5 collected in the year previous. This year, they are projecting nearly $147 million to be raised through gasoline taxes. Past numbers alone prove that people still had to buy gasoline, although the price was still high. They just didn’t go out of their way to visit as in other years.
“The increase in tourism numbers for the St. John’s area showed that there was more airline traffic into the city. Tourism numbers were up slightly in the St. John’s and surrounding area last year, but rural areas suffered a different fate. Rural areas didn’t have that same advantage and we need to give them a fighting chance at getting tourism revenue up. We also need to give the Newfoundland and Labradorian tourist the incentive to stay at home; give them a chance to explore our own province.
“Numbers were down from years previous by a few percentage points. Last year, we saw a sharp upwards increase in pricing that peaked during the first week of July. This year, they’ve hit last year’s numbers already. Pricing is expected to stay higher and for a longer time this summer. That could mean trouble for everyone and we’ll need to depend more on our own people to support our rural tourism markets.
“I think that consumers here already recognize the need for road and bridge work. We also have heard that government is intent on spending a “record” $66 million on roads and related infrastructure, a far cry from the money they have collected in the past from gasoline and other motive taxes. We’re not asking for much besides recognition from government that we have problem with high pricing. A cut of some four cents on a litre in gasoline taxes for the summer is not an unreasonable amount to ask for. What it symbolizes is that recognition, that as tourists and consumers, we are made to feel that we’re welcome at home too.”
-30-
For more information, contact;
George Murphy
Group researcher/ Member
Consumer Group for Fair Gas Prices
(709)782-8053
(709)685-6186 cellular
My blog: www.gasandoil.blogspot.com
Email: gasprices@hotmail.com, gasprices@nl.rogers.com
Tuesday, May 22, 2007
It's all about the refinery problem, but should it be?You're hearing an awful lot about refinery problems and the ability of refineries to shove more expensive crude through the refinery system.
You're also hearing that demand and supply are in delicate balance and that inventories of gasoline remain low.
What you hear is all about what the markets want you to know and not about what they should be telling you. They've compromised the economy by taking a product like gasoline and increasing it incrementally to the point that it rises far ahead of the world inflation rate. It must be the only product in the world that can do that.
But, here we are at record prices, and Newfoundland and Labrador consumers will take another 3.6 cents a litre hit on Thursday morning, May 24th.
Hit the pumps again!
Hurts too...
What makes this one specially hard is the fact that the new price you'll see will be an all-time record outside of the couple of days in the aftermath of Hurricane Katrina. Last year saw a record $1.22.5 a litre. Thursday should show $1.23.4 or close to it.
What also hurts is the fact that heating and stove oils are set to increase, albeit just a couple of tenths up. Reality tells me that tis the season for pricing to head the other way for a winter commodity. It just ain't happenin'!...
What kills me about all this is that Big Oil has been long quoting the Nigeria situation explaining the need for the best crude oil the world. What they haven't explained is the fact that oil is so expensive when there is plenty of the cheaper type crudes out there. Not everything that is available out there has to be a West Texas Intermediate, although it would be nice. The reality of the markets are telling consumers that we can get by without the expensive stuff and so should you.
Remember, Big Oil...You're making record dollars in refining. We shouldn't have to be made to follow the piper on this one. You created the refinery breakdown problem when you didn't invest big money into refinery maintenance. You must have known this would be a problem in the future.
Or, was it the need for better returns for your shareholders that caused all this? The scenario: well, if we don't invest in our refineries, we get to save money. When they break down, we get to reap the benefits of a fuel shortage!
Funny...
For some reason, I just don't think that Big Oil had the consumer need at heart when they let that card slip from up the sleve.
Question is: what else have they got?
Regards,
George
Thursday, May 17, 2007
All pricing up...
Markets just don't reflect the reality
Watching the markets today?
Oil?
Yup. You know what's coming!...
If you happen to be close on empty right now, may I suggest a fill-up, because you know what you are going to see in the morning.
In the United States, you will be looking at another couple of pennies on a gallon while, here in Canada, you will see close to another two cents on a litre. Make note of the date on the blog here because when you come back again, conditions may have changed.
In Newfoundland and Labrador, while prices here won't be changed again until next Thursday, there is a guarentee that we'll be looking at close to another 4 cents on a litre at the pumps if all conditions stay the same.
Well, why?...
Today the markets are trading on speculation that there are going to be refinery issues this summer. That's not unlike when Hurricane Katrina blew in over the Gulf Coast in 2005. Back then, there was a promise of refinery disruptions that eventually came true. While nothing like that has happened yet, the markets are trading on future, perceived problems that HAVE YET TO OCCUR.
That's what's wrong with the gas pricing picture. We're paying for something now, rather than on what can actually happen.
That's like betting on the Toronto Maple Leafs winning Lord Stanley's mug; hardly likely this year but entirely likely in the next twenty years.
Yes, the Leafs will win the cup but it hasn't happened yet...
Traders are betting on your future. Let's hope they lose their shirts, but, right now, someone on the New York Mercantile Exchange is making a heck of a lot of commission and Big Oil loves them for it.
Conspiracy? Dunno about that, but certainly a symbiotic relationship!
Regards,
George
Tuesday, May 15, 2007
The promise of increases to come...
We hear every day now, that pricing will rise further to consumers and that there is no relief in sight. What we do know is that refiners have been making a fortune and so have their Big Oil cousins. All said, the promise is there for pricing to hit record levels, especially after todays news.
The situation in Nigeria is a restless one. When oil was discovered there some years back, it brought with it the promise of a better life for those who didn't know the wealth to be gleaned from the underground resource. All that was heard was that "things wuld get a whole lot better".
They haven't...
Especially in the resource rich Niger delta where most of the resource is located.
The people there live in squalor and they have yet to see any tangible benefits like money for education, roads and infrastructure.
Where is Big Oil in this?
Does Big Oil have a responsibility to look after a people when it goes for their resources, especially when a government like that of Nigeria fails them? Should Big Oil continue to rape a resource knowing that the harvest of which can bring the problems that have come to be realised?
What of the next country?
Next time you go to the pumps, consider this:
If I have to pay high prices for a product that is succeptible to the pressures of a geo-political situation in Africa, should I have to see pump pricing that DEPENDS on a resource from that region? Should I be worried that someone is smacking a hole in a pipeline to get part of a product that I can take for granted at the pumps of Young Street in Toronto or Kenmount Road in St. John's?
Should geo-political problems elsewhere be the determining factor in the resons why Canada should have its own sources of supply rather than be dependent on someone else's resource, namely Nigeria's?
Toady, Shell announced that it has lost another 170k barrels a day in crude oil production from that country and so far, the markets are pointing up on the news. The promise is there at this time, to see another couple of cents on the pump price by tomorrow morning, all for the simple sake that the citizens of the Niger Delta are looking for their piece of the oil-rich pie: for fairness and fair treatment.
Perhaps it is time we look at ourselves and a secure supply for Canada, not just for our sake but for the sake of a people who are thrown to the wayside in the vain hope that Big Oil is looking merely at profits instead of ensuring the people of the country get their fair share rather than letting despots who rule the roost gather the benefits derived.
Perhaps Big Oil should take part responsibility in getting the people of that country looked after before they smack a drill-bit in the ground. Maybe they shouldn't pay directly to governments who aren't going to look after the people for them. Ahhhhh, but that's the way governance works in the world, isn't it?
Perhaps it should be the case where Big Oil should just back away until people's rights are recognised.
Regards,
George
Tuesday, May 08, 2007
Gasoline to rise. Our turn to take the hit...
In Newfoundland and Labrador, consumers will wake up to find that pricing for gasoline did, indeed rise a couple of more pennies, to reach an unprecedented level for this time of the year.
Spot pricing for stove oils however, are showing a downwards trend thankfully...
So far, gasoline shows a 2.7 cents a litre increase while stove oils show 1.24 down. That's with two more business days to go.
I expect that both numbers will be less than what I have here with the next two days measurements included. I expect gasoline to show a more moderate increase than what I have and for stove oils to decrease still further.
Keep your ears to the media to hear the details. I'll have a release out in the morning when numbers for "day 13" come into play.
Now, for what's on my mind after all these increases in other jurisdictions the last couple of days...
When I first heard of the latest rounds of "panic buying" I kept wondering how these companies or businesses manage to stay in business without some sort of consumer revolt. I am absolutely amazed that some of these businesses could charge what they did-when they did without any hard evidence to justify such an increase in pricing to the consumer.
Vancouver did not deserve to see pricing that hit $1.32 a litre at the pumps. Nor did Toronto residents who saw an added 10 cents a litre.
Spot pricing for gasoline product peaked at 7 cents from April 22nd to reach 67.1 cents a litre on April 30th...
Just because we're dealing with a "savvy" oil industry that knows they can "do maintenance" to justify a draw on United States gasoline inventory does not justify the move in pricing that consumers saw. Shutdowns for refinery maintenance is taking longer to achieve the last couple of years and the periods that they claim for taking refineries off-line to do it, are getting longer.
Why?
My belief is that refiners want to draw on inventory to drive up pricing simply to recoup the capital costs for such "maintenance". The more time they take in getting refineries up, the less inventory is made available for the summer driving season. The less inventory gives the trader more time to speculate on future pricing of gasoline and other motive fuels and that means higher pricing to be paid for a product that is so important to the consumer.
We're lucky -this time- that our market here in Newfoundland and Labrador, is regulated. What regulation did at this time-frame the last week was take away the initiative for the companies to drive up pricing here. It also protected the consumer from an "artificially created" and imaginary problem that was created by the New York Mercantile Exchange traders. We were, at least partially protected from the hit consumers had to take on the mainland.
Should there be an investigation into the oil company's practises in North America?
Yup!...
Darn tootin'!...
Regards,
George
Wednesday, May 02, 2007
What's got to break?
what will it take to draw down pricing?
I get a lot of people asking me these questions lately...
Maybe it's time I give everyone some answers on what has to change though, and not what will it take...
I've come to learn these things over time. some things here might be hard to understand. If you find it hard, drop me a note and I'll try to explain it later. Sometimes I have the tendency to "over-explain" things and that drives people, even my wife, nuts!
The problem you have on the markets is relatively simple though. What you have is the case where Big Oil closed refineries, we still kept driving as we always did and then some.
In short? While the oil companies "cut back", we didn't... and we also put more drivers on the road at the same time. Inventories are being impacted and, depending on the season, it could either be gasoline or heating oils and distillates that are affected.
We helped create the problem by not asking our car manufacturers to give us better gas mileage. We've created the problem by becoming dependent upon "exterior" sources of supply. We have allowed our own Canadian supply of raw product out of the country to be refined south of the border.
We are the authors of our own demise...
Today, as you are watching your pricing rise, remember the basics that have been created for all to see. Limiting supply to an increasing number of consumers equals trouble. Not asking our governments for better than what we've gotten over the last few years should also have us thinking a little bit into the future on anything that's sucking the bucks out of your pockets.
That's it from me for now,
George
Friday, April 27, 2007
"Nothing doin" budget for gas or heat users
Seems that every budget day, motorists in this province, and indeed across the country, are feeling a little left out when the good times are rolling.
Such has been the case for both the federal and provincial budgets, both of which were abject disappointments when it comes to some form of pricing relief.
Neither budget adressed the issues of high taxation on a commodity that has experienced rapid increases that far outweigh the rate of inflation. Prices aren't going to ease anytime soon either, in case you were wondering. My numbers are still reflecting anywhere between $1.22 to $1.31 a litre for regular unleaded gasoline by the first week of July here in Newfoundland and Labrador.
Here in Newfoundland and Labrador, gasoline taxes amount to almost 16.5 cents on a litre while the sales tax component averages half that again. Last year, the province collected close on $142 million in motive taxes and only invested close on $66 million back into road and ferry infrastructure, a far cry from the amount collected neddless to say.
Is this fair?
I think not...
If you're going to collect a tax for a specific intent, then collect it and SPEND it for it's intended purpose. Don't tell me that the people of Labrador aren't worth hard surface instead of a chip seal experinment. Don't tell me that the province has to wait for something to happen in the west bound lane of the Harbour Arterial road before proper dollars are spent and we see a full accounting of road work...
Heating oil users in Canada this coming winter are going to be in for a shock when they go to fill their tanks. We're not seeing spot prices fall back in the non-demand season for the fuel when it should be. Spot prices are now just slightly below those of last year and just aren't falling back the way they used to a couple of years ago.
Spots for gasoline exceed those of May month last year by something like four cents a litre.
Call me crazy... But in yesterdays budget, would motorists and energy users be better served by a tax break on any motive fuel and a complete removal of the province's taxation component off all forms of heat?
If the province wants to preach about taking charge of it's own house, then why didn't it start with breaking the HST Agreement of 1998 and enter into a "control" of it's own fiscal regime? Why can't we call our own shot on most taxes here in the province and give everyone a break on taxes that are collected at the sales tax level rather than the income tax level?
It sounds a lot easier to do that across the board rather than see income tax breaks that rival the equalization formula.
Income tax or equalization. Can any of us figure out how either works?
Maybe budget time should be turned into something tangible next time. You know...Something we can all sink our teeth into...
Regards,
George
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