Oil remains elevated

An increase coming for gasoline prices

Media release

Conception Bay South, NL, March 29, 2011- It's not often that George Murphy's numbers are wrong, but he's hoping that they are this time. Numbers are showing that consumers could see an additional 2.6 cents a litre up on gasoline prices for this week when the PUB adjusts prices this coming Thursday.

"Oil prices remained elevated this week after last week's modest retreat, gaining almost three bucks a barrel US, hitting a new record high since September of '08. We're right back to where we left off with gasoline prices edging upwards and heating oils remaining unaffordable to most. Something has to give. Consumers are going to have to start to let their wallets do the talking." Murphy said.

"Numbers show just a 9/100ths of a cent drop to heating and stove oils, a 4/10ths of a cent drop to diesel prices and a 2.6 cent a litre increase on the way for gasoline. The troubling thing about all this is that, after last weeks data, there was still a demand for gasoline and that helped support the high price. In spite of the rising price, inventories of gasoline continue to drop.

"Heating and stove oils are still showing signs that prices will not be coming down anytime soon. With oil prices up again because of demand and the world geo-political situation, I expect that they will remain high for some time to come. The provincial treasury will continue to reap the benefits of that while consumers will have to collectively start to impact inventories and demand itself. Right now, unless we see economic collapse or more banking problems out of the European Union, we're probably not going to see any relief in the interim".

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For more information, contact;

George Murphy

Group researcher/Member

Consumer Group for Fair Gas Prices

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