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Tuesday, August 31, 2010

Prices not sustainable for long
Consumers to see slight increases this week

Media release

Conception Bay South, NL, August 31, 2010- In spite of today’s retreat in oil prices today, consumers can expect to see a slight increase in most fuel prices when the PUB adjusts prices this coming Thursday. That’s from George Murphy, group researcher with the Consumer Group for Fair Gas Prices.

“For the best part of this regulation period, oil prices climbed slightly above $75 US per barrel. With the exception of today, refined commodities also climbed, and that means some slight adjustments to prices, at least for this week. Today’s retreat in prices may be the forerunner of what is to come for next week.” Murphy said.

“I expect heating and stove oils to increase by 3.29 cents a litre, diesel to increase by 2.2 cents, and gasoline is showing an added 1.5 cents a litre at the pumps. I don’t think this will last long as the markets are again getting the jitters with any hopes of a strong economic recovery. I’m expecting a retreat in prices for next week, especially as an industry report is showing ‘glowing’ numbers in inventories of crude oil and gasoline.

“Inventories are at a high for the summer months and demand is mellow as compared to other years. The data is starting to form an even bleaker picture for any recovery in oil prices, especially considering the fact that inventories are at their highest since the Reagan administration and distillate inventories also sit at record levels. That could mean some moderation in prices to consumers if investors recognize the signs of trouble out there.

“The traditional end to the driving season is fast approaching and consumers may see some moderation in the weeks to come, and if investors see the signs, oil investors may be forced to yield. Maybe then, with cheaper energy prices, we might be expected to be witness to economic recovery. With oil prices high, we can’t expect recovery to happen readily.”


For more information, contact;

George Murphy
Group researcher/Member

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