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Tuesday, February 22, 2011

Consumers to notice price changes

Media release

Conception Bay South, NL, February 22, 2010- Consumers in Newfoundland and Labrador will start to feel the effects of market turmoil as Middle East unrest again plays out , this time from Libya. That comes from George Murphy, group researcher with the Consumer Group for Fair Gas Prices.

"While this weeks numbers don't look substantial, they will really start to take a movement upwards on all fuels starting next week as the Libya situation only started to take shape in the markets as of today's on-floor trading", said Murphy. "I fully expect to see consumers to take another hit next week as numbers are already starting upwards for the next regulatory session."

"This week, I expect heating and stove oils to show just a mere 3/100ths of a cent upwards movement, diesel to show a 8/10ths of a cent upwards move, and gasoline to show a 1.7 cent a litre movement upwards. However, the markets already show upwards movements for all four fuels by close on two cents a litre that I do measure for next week, all as a result of the Middle East unrest, and what role it's going to play in the oil markets."

"While the turmoil in the Middle east continues in Libya, it could easily spread to other oil producing nations, or OPEC members in the region and could further compound the oil market problem. While the Saudis may be able to handle a production or supply disruption problem with the four million barrels spare capacity that country has, it cannot handle similar problems if the unrest were to spread to Iran, which is said to be on the edge of further Middle East instability. That, in effect, would be saying 'force majeure' and then the sky would be the limit to oil prices and to prices for refined commodities. The only thing that may save us, or insulate us somewhat, is a high Canadian dollar, and even that may not save us if economies collapse as a result of high energy pricing."

"We're keeping a sharp eye on the Middle East situation as it progresses."


For more information, contact:

George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices

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