Prices close to a buck a litre short-lived
Gasoline set to rise again

Media release

Conception Bay South, NL, October 6, 2009- Gasoline prices are set to rise again, that’s according to George Murphy, group researcher for the Consumer Group for Fair Gas Prices.

Since last week, I’ve been seeing some evidence out there that there is some economic recovery happening and that is bringing with it the promise of a possible rise in interest rates and more investment in commodities like petroleum products. Last weeks inventory data out of the United States also saw a surprise draw on gasoline inventories signifying an increase in demand and all these factors are combining to show us an increase in gasoline prices this week,” said Murphy.

“Gasoline prices are expected to increase by close on 3.1 cents per litre this Thursday while, heating and stove oils are set to drop by 35/100ths of a cent. Diesel prices are also showing a modest drop of close on 6/10ths of a cent per litre. Gasoline prices dropped last week almost 4.8 cents as a result of the use of the interrupter formula.

“I’m not alarmed by this increase as it is coming as a result of a number of other factors. A surprise draw on inventory coupled with a drop in refiner capacity as a result of service shut-downs helped the spike in gasoline pricing this week. Even though price was lower, there still remains a huge inventory build that has to be dented before we see any significant increases to consumer prices on the way. The big unknown here however is: How long will the recovery last and is it artificial? Are we going to see another economic collapse as a result of higher interest rates that could curtail spending?”

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For more information, contact:

George Murphy
Group researcher/member
Consumer Group for Fair Gas prices