Numbers are up but only slight increases expected

Media release

Conception Bay South, NL, August 25, 2009- Last week’s surprise draw on inventory will translate into some minor increases in fuel prices when the Public Utilities Board moves to adjust prices this coming Thursday, that’s according to George Murphy, group researcher for the Consumer Group for Fair Gas Prices.

“The numbers are not too bad in the wake of market activity over the past two weeks. We witnessed a movement upwards in crude oil prices from $69 US a barrel, reaching a high of almost $74 US and a slight retreat to Tuesday's price of $71.55 US a barrel. Spot prices for most fuels also showed that there was only slight movement upwards in the prices for refined commodities”, said Murphy.

In the numbers
“The numbers show a slight increase to all fuels, some too close to call whether there will be any movement at all in price. Heating and stove oils show an increase of 85/100ths of a cent, gasoline shows an increase of 1.5 cents a litre while diesel fuel shows a bare one tenth of a cent increase. With the margin of error of three tenths, diesel fuel may in fact show a slight decrease, if no change at all.

Hurricane Bill brings questions
“It remains to be seen whether Environment Canada will see the data on Hurricane Bill and announce it as landing as a category one hurricane. While I haven’t heard if the North Atlantic refinery faced any difficulties with the hurricane the other day, it begs to question if, in the future more hurricanes will race into the coastline of the province affecting the viability of the placement of refining facilities in Newfoundland and Labrador coastal waters. We know what hurricanes did to Gulf of Mexico refineries in 2005 in the wake of Katrina and Rita. I believe that this is going to be a paramount issue in the further development of onshore processing of crude oils in the future if in fact there is going to be a distinct change in weather patterns that will bring hurricanes closer to Newfoundland and Labrador waters.”

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For more information, contact;

George Murphy
Group researcher/Member

Oil on the edge of collapse?

A lot of breaking news stories seem to be following the trend that I detected some time ago that was fully leading to another collapse in oil prices, and, for some at least, it couldn't happen at a better time.

So, what evidence is there that a collapse is possibly in the works?

Let's look back at the last few weeks to set this one up for you and help you draw that mental picture....

Fact #1: While we have been witness to a small spike in prices during this summer that saw gasoline here in Newfoundland and Labrador reach $1.10.4 a litre just the other day here in St. John's, we simply didn't see a large increase in demand based from prices a lot lower than they were the same time last year. Demand for gasoline has remained flat and now we are at the end of the summer driving season and not a hurricane in sight of the Gulf of Mexico.

Fact #2: Just today, US consumer confidence, in a survey done by Reuters and the University of Michigan and reported by Bloomberg, conclude that consumers south of the border continue to be skeptical over any economic recovery. That means that consumers aren't going to be buying and a delay in any recovery of the economy.

Fact #3: The Energy Information Administration reported a good build in crude oil inventory, albeit a small draw on gasoline. The report also concludes that refiner capacity has dropped again to 83.5 per cent from last week's numbers. Refiners are trying to keep ahead of the massive drop in consumer demand and they're also trying to reign back production so they don't overdo it with current supply. The numbers for distillate fuels don't look much better. Demand for both heating oils and jet fuels has crashed again this week ending the summer dream of increased profits for Big Oil.

Fact #4: The price for Brent type crude oil has surpassed West Texas Intermediate, now resting some Three dollars above WTI as of today. Basically, there is too much inventory floating around, not only in onshore storage tanks but also in tankers, simply waiting for the value of WTI to increase and/or be consumed. It's not!

So, what to expect in the coming weeks?

Look for a mass retreat in prices that some are predicting will bring prices back to where they were in April. Cheap to the consumer and murder on the provincial and federal treasury!
At least, from this perspective, here's hoping the news comes to fruition! It's going to be a couple more weeks before we feel it at the pumps but, needless to say I think we've hit the summer peak.

Regards,

George

All numbers up for Thursday
Gasoline, diesel, heating and stove oils to increase

Media release

Conception Bay South, NL, August 11, 2009- Consumers in Newfoundland and Labrador will see prices for all petroleum products increase this coming Thursday morning when the Public Utilities Board moves to adjust prices.

“Other areas of the country have already been hit with increases in prices. We’re no different here. The numbers are showing an increase of 3.67 cents a litre on heating and stove oils, a 4.4 cent a litre increase to diesel fuels and a four cent a litre increase coming on gasoline pricing,” said George Murphy, group researcher for the Consumer Group for Fair Gas Prices.

“An increase in oil prices coupled with a US drop in refinery capacity along with the falling US dollar are to blame this time around, even though there has been no increase in demand. What I do see here is an attempt by the US refining industry to control output with demand factors. Refinery capacity has dropped over the past three weeks from close to 88 per cent to almost 84 per cent of capacity and that means pressure on refined commodities.

“Pare with that the fact that there are some inflation fears in the markets meaning a heavier level of investment in commodities rather than the US dollar. That’s why the Canadian dollar has gained some strength in recent weeks. The basic spot price has been insulated a little as a result and the increase in gasoline prices for example, has been mitigated somewhat. Consumers in the US have seen an increase of almost thirty cents a US gallon while we’ll be looking at a four cent a litre increase at the pumps here, or about 17 cents a US gallon.

“Last week showed its ugly head when the news of the drop in refiner capacity was published. There is a move to control output here in North America, particularly in the US according to the US Energy Information Administration. The drop translated into a drop, albeit slight, in US gasoline inventories. It was a concerted move by the oil industry to support prices in the face of very weak demand in spite of lower prices as compared to last years numbers.”

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For more information, contact;

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

Numbers are up!

All The data isn't in quite yet. There is one more day to go.

However, there is enough data to show for increases coming down the pipes for this Thursday as a result of market activity this past two weeks. While the interrupt scenario thankfully didn't play out, the rise in the cost of oil will play into your pocketbook later this week.

One more day to go, like I say, but here's what I have so far.

• Heating and stove oils are up by 3.51 cents per litre.
• Diesel (9 days of data) shows up by 4.3 with taxes in, and...
• Gasoline is up by 3.7 cents a litre.

Just a final note here. The last price change showed i was off somewhat from the actual that occurred here and I have not taken that into account in the final summation of my numbers. The actual increase to gasoline might vary somewhat higher than what I will have here now, let alone that of tomorrow night when i post again with what I have. This one is just to keep you all ahead of the game.

Oh well!

Time to hit the pumps again!

Regards,

George

Just in case, you might want to top off the tank!

My numbers don't show interruption to gasoline pricing is definite, that's first off...

However, the last two trading days have me a little concerned as to how much volatility there was in the markets since the last pricing adjustment last week.

When the last numbers came out, and only showing a 3/10ths of a cent a litre increase, I had it different by a full cent. That's leading me to believe that there was possibly enough market volatility over the past few days to warrant something happening with the numbers that I can't track.

Of particular interest are the last two days on the markets that put gasoline spot prices over 60 cents a litre from my last average of 53.87 cents just a week ago. Yes, a full six cents since the last adjustment.

Faulty data over the weekend is the kicker. I haven't been able to get hold of the prices between Friday and Sunday night that could spell it out in the numbers for sure. In other words, while the last two days are well over those required for interrupt to occur, I can't predict that it will happen on Thursday as a certainty. So far, my base average for the days I do have put it close to interrupt territory.

Another clue that it might?...

The base price of West Texas Intermediate, which I take a measure of, has increased by almost eight bucks a barrel...

Enough said!...

I think I'd be apt to hit the pumps Wednesday night, just in case prices do move Thursday morning. In the event they don't move pricing up this Thursday, you can be darned sure that if the market trend does keep up, we'll be looking at substantial increases next week.

Regards,

George

Numbers show 'up a little"

With all the goings on at my place these last two weeks, I really haven't had the time to do a lot of posting and tracking of the news in the oil markets.

I have had the time however, to go though the numbers and see what's in store for the consumers out there in Newfoundland and Labrador.

Here's what I have for Thursday morning:

• Heating and stove oils to increase by 1.55 cents per litre.
• Diesel to increase by 1.6 or 1.7 cents per litre, and...
• Gasoline to increase by 1.6 cents per litre.

The US dollar lost against other world currencies over the past two weeks and that resulted in heavy investment in commodities like oil, driving those prices upwards over the time frame. Oil gained almost $8 US barrel since July 14th.

One side effect was that the Canadian dollar also was one of those currencies that gained ground a s a result of the investment in oil, with the dollar gaining over three cents against the US greenback.

Anyway, prices will be up slightly, not that it wasn't predicted to be like that with some volatility over the summer!

Hope it all helps!

Regards,

George

No increase in prices this week

Watching the markets the past few days probably made some people a little nervous, especially in the thinking that with a rise in oil prices of almost $4.50 US a barrel.

My email has been littered with the question "If"...

Here's the reality...

The numbers are not there for interruption to prices to occur. Both heating and stove oils as well as diesel, are now at "break even" with neither an increase or decrease showing in the numbers.

Gasoline prices show down by a half cent, so far...

While spot prices for all the fuels I measure has gone up a little, we are still a little under the average for the last price setting this week. Keep in mind that, if the trend continues, we may see a slight bump in prices at the next price setting next week, that's if the numbers allow for it and we see the price of the refined comodities take off again. This latest run-up has been caused by positive economic news out of Chine and a decrease in the US dollar. Of course, whenever we see the US dollar slide, it's a sign that traders will start investing in commodities like refined oil products, as a hedge against inflation.

Hope this will clear the air a little?

Any questions, drop me a note...

Regards,

George

So, where are prices going from here?

It's a nice summer morning here in St. John's, especially nicer after hearing the news that fuel prices are down; and a lot of questions from people asking if the downwards trend will continue...

Here's hoping! The evidence is certainly pointing towards "steady as she goes" and also "down" in the best of scenarios. If I were an oil trader, I think I would quit, let's put it that way.

Right now, the news is not good if you are an oil man. With waning consumer demand for gasoline and another build in inventories this week, it's hard to wonder why there should be any price increase in the foreseeable future. The fact that North American drivers just aren't buying to the same degree that a lower price should dictate, should be a forewarning to most of the change that drivers are facing. Consumers are not cutting back on consumption because of price, they are doing it out of necessity that the economic situation is bringing to them. Prices for gasoline are now about 35 per cent lower than the same time period last year, yet demand, is recorded at a mere 6/10ths of a percentage point above last years numbers.

Consumers can't spend because of the uncertainty of the ongoing economic recession. I like to call this "enforced conservation" a new economic term you'll soon be hearing about in your favorite business news network or late night TV host!

Enter the ongoing prospect of an oil glut in the markets. While the data from the US Energy Information Administration showed a draw on US inventory, the same still shows a huge 47 million barrel surplus in stock in holding tanks that should be heavily drawn upon during summer months of the past. The word from OPEC is that they produced some 57,000 barrels per day more than their own self-imposed quotas during the month of June and this is only now coming into the North American inventory grid. Talks are abounding of $45 a barrel US oil in August, not heard for a long time during peak summer driving season. Some experts like Philip Verlager are even predicting $20 US a barrel oil and an imminent collapse in prices this winter at best.

Also adding to the downwards pressure on gasoline pricing in the coming weeks is a pick-up in US refinery capacity, up again this week to almost 88 per cent. With added capacity and waning demand, why would I as a trader even bother investing? There's no return here.

The only possibility of upwards pressure on oil will have to come from here but, right now, it's showing just like a St. John's July 16th morning : Nothing but clear skies!

The trend of falling prices might be around for a while. The news from the Alberta oil fields won't be all good if that's the case.

Hope this answers a few questions out there?

Regards,

George

Update #2

Final Numbers

Here's what I have to come for Thursday morning with all fourteen days of data on hand:

• Heating and stove oils to drop by 4.79 a litre.
• Diesel down by 4.7 cents a litre, and...
• Gasoline to drop by 6.3 cents a litre.

I tried to get a copy of the press release posted but, for some ungodly reason, it wouldn't allow me.

The old "copy and paste thing just didn't do it this time. It's something I'll have to work on, I guess!

Hmmm....

Regards,

George

Update #1

Numbers still showing "down"

Numbers are still reflecting the big drop in spot prices last week and they will impact all prices this week (Thursday) when the Public Utilities Board sets prices for the next pricing period.

Here's what I have with thirteen days of data at hand.

• Heating and stove oils are down by 4.55 cents a litre.
• Diesel is down by 4.5 or 4.6 cents a litre with taxes in, and...
• Gasoline is down by 6.1 cents a litre.

One more day to go here but there may be no more real changes in pricing other than what I have. Another day may mean a couple more tenths off these numbers.

I'll post another update for everyone tomorrow evening and post the press release too.

Regards for now!

George

The week so far...

Here's a little update on the numbers I have. After the disappointing finish up to Tuesday, I think maybe I should keep everyone in tune as to what is transpiring out there...

First off, as regards to the possibility earlier this week that the PUB may use the interrupter formula, I'm not surprised that they never.

I'm more surprised that they didn't have the market volatility to show a more significant drop that would have allowed the formula to be used. In other words, that their numbers reflected more than four cents for the formula to kick in.

In the end, my numbers showed an exact 3.77 cents a litre downwards, just shy of the required four cents for interruption to occur.

Yes, it sucks to be out by that much but, that's the rule that is used.

An important point here to remember is that, while other jurisdictions see an almost immediate drop in prices relected in their respective markets because of the competative nature of their markets, our numbers are usually hit the pumps roughly a week later if they meet criteria for interruption. (We can only wish for competition here in Newfoundland and Labrador to be the final arbitor of the retail petroleum price!)

Conversely, whenever there is an increase in other respective markets, these increases are also immediate to their various areas and we then see any respective increases about a week after the event occurs. Here, we also take a two week (one week during interrupt scenarios) average of price movements before any alowable increase or decrease is passed on and that timeframe is also taken into account simply to allow any movements in pricing to "work itself out" as during the Katrina and Rita hurricane events of August and September 2005.

Other centers saw gouging to the point that some retailers in the Stratford, Ontario region charged upwards of $2.25 a litre for gasoline.

Halifax and the area there saw $1.89 a litre until word got out that the prices at the pump outweighed the spot prices of the day and we got onto them.

The fact is, is that we hit $1.48 a litre here in St. John's because we were regulated. Prices didn't change as much as the companies wanted them to fir the simple reason that the PUB waited an extra day to let the market work itself out, and it did.

I'm getting off-track here again...lol

Anyway, just to keep you all up to speed on what I have with nine days done and still five more days to go:

• Heating and stove oils are pointing down by 3.50 cents per litre.
• Diesel is down by 3.4 a litre and...
• Gasoline now shows down by 5.1 cents a litre.

My guess for the result after the full fourteen days are in?

• Heating and stove oils down by 4.5 cents a litre.
• Diesel down by 5.0 cents a litre and...
• Gasoline down by 6.5 cents a litre.

See how close they'll be after Tuesday night!

Anyone else care to take a shot at it?

Regards,

George

Oh well...No suprise that prices didn't drop

I'm irked...

Maybe I should just keep quiet every time I get a way of thinking and keep my thoughts to myself. No suprise that I'm a little disappointed though but in hopeful expectations for next weeks price setting nonetheless.

After Tuesday, I thought that the numbers would show those for interruption.

Didn't happen...

Numbers here showed a good start to a price drop but, for some reason, and I'm still looking into it, the drop showed a "stall" and the numbers averaged out to be 3.77 cents a litre down, just a mere 23/100ths away from the required four cents a litre for interruption to occur. Another day and things would have kicked in.

It was painful to watch the numbers come up on the calculator!

So, we have to wait for the regular price setting fornext week it seems because we know that the Ultramars, ESSO's, Irvings and North Atlantics aren't going to drop prices ahead of time on their own!

Use it sparingly for the next six days anyway. So far, with Wednesday data in, numbers are now showing close on a nickel down at the pumps. If oil continues to drop in the days leading up to the 14th, then the drop at the pumps could be significantly more.

Regards,

George

Is there enough volatility in the markets this week?

Those of you watching the markets this week are probably asking the same question this week, wondering if consumers here in the province will see a drop in fuel pricing: Is there enough volatility in the markets right now, to warrant a drop in prices?

This week shows a drop of almost seven bucks a barrel US with corresponding spot prices dropping by nearly five cents on a litre after yesterdays market close. While my average for the last pricing session was set at 58.05 cents a litre, that average has touched near three cents after yesterdays market activity. The average for the preceding six days I now have at 55.38 cents a litre, a difference of close to 2.7 cents a litre.

Interruption requires that four cents a litre, up or down, from the previous price setting, are needed for interruption to occur.

That being said, again today, we're looking at gasoline trading down by another two cents a US gallon and that number does not include any market volatility that my numbers do not record.

There is a possibility that gasoline prices may be adjusted downwards after Wednesday night as a result of that, market volatility.

Other fuels like heating oils, stove oils and diesels, are also down but are less than the 2.7 or so that I have for gasoline.

Trouble here is that I also have numbers for the first six days that also shows greater than 3.4 cents a litre down on gasoline, taxes not included.

With oil prices collapsing again in the face of weakening demand and bad economic news, it may be well advised to hold back on any purchases you might want to make in the next day or so, that is, until we see what the Public Utilities Board is going to do this coming Thursday.

Those in other jurisdictions might want to follow the same advice: drops in pricing are on the way!

I'll know more after tonight's numbers come in for Newfoundland and Labrador, so stay tuned!

It's going to be close!

Regards,

George

Drops coming you say?

Might be the first time some of you will be happy with me, at least for the next two weeks.

Sorry I'm posting late as I was working late last night.

Here's what I have, with all the data in. Nothing substantial but it all helps I guess:

• Diesel to drop by 3/10ths of a cent.
• Heating and stove oils to drop by 64/100ths of a cent, and...
• Gasoline to drop by 1.5 cents a litre.

No official release on this one this time. What you're looking at is coming for this Thursday morning.

Hope it works out!

Regards,

George

The following is a copy of a letter I sent off to the Prime Ministers office and the Minister of Transport for the Government of Canada on the Marine Atlantic fuel surcharge issue.

Let's see if we can get an answer!

Right Honourable Stephen Harper
Prime Minister
Government of Canada
Office of the Prime Minister
80 Wellington Street
Ottawa, Ontario
K1A 0A2

Dear Mr. Prime Minister

I am writing to you today to tell you of my concern as regards to Marine Atlantic’s possible application of a round of fuel surcharges on ferry rates and what the Government of Canada can possibly do about it.

During the sailing season of June, 2007 and again in 2008, Marine Atlantic was forced to institute a round of fuel surcharges that were applied to ferry rates and passenger fares to users of the service across the Gulf of St. Lawrence. This caused an undue hardship and an artificial inflation rate, especially to goods and services being used by Newfoundland and Labradoreans. Particularly hard hit was grocery items that were being transported across the Gulf by trucking companies who also recouped their added fuel surcharge expenses crossing the gulf by adding fuel surcharges onto their goods and services entering the province. In turn, these added costs were handed down to the consumer in the form of higher prices for commodities, adding more stress to consumers and businesses here.

While earlier this year (January) fuel surcharges were removed from Marine Atlantic ferry rates, prices for marine type fuels have been increasing from their near record low of last October. Prices for marine type fuels have increased since January when fuel surcharges were removed and have reached a point where Marine Atlantic will be making a decision on adding a fuel surcharge once again to Marine Atlantic ferry rates, again increasing pricing to the end user, the consumer of Newfoundland and Labrador. Today, according to my research, the price of residual fuel oils has surpassed the June, 2007 price by almost thirty per cent, making the possibility of added fuel surcharges almost imminent during the start of the auto tourist user season across the gulf. A decision by the Marine Atlantic board is due shortly on any fuel surcharge addition.


I am writing you to ask you to help Marine Atlantic absorb these costs by adding additional funding to the Marine Atlantic budget as a measure to help the Newfoundland and Labrador consumer avoid seeing an added, artificial inflation rate added to consumables as a result of added fuel costs.

This is possible for the Government of Canada to accomplish. The Government of Canada recently announced a 10.7 billion dollar investment in the automotive industry to help the Ontario economy and other areas affected by the downturn. It would be my estimate that, in order to maintain the level of consumer spending and help support the tourism industry here in Newfoundland and Labrador, the Government of Canada could make the strategic investment into Marine Atlantic’s fuel budget to ensure consumables and visitors to this province do not get hit with added fuel surcharges.

I’m hoping that your office and the Government of Canada can turn some of its attention to this issue and I await your reply to my query.

My regards,

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

Final update (#3)

Oil markets still in drive mode
All fuels show increases on the way

Media release

Conception Bay South, NL, June 16, 2009- Oil prices are rising and so are the costs to the consumer with all fuel prices set to increase later this week, at least that’s according to George Murphy’s data.

Final numbers in
“Stronger numbers are in today that show all fuel users in Newfoundland and Labrador will experience increases in consumer prices this coming Thursday morning. With all data now in, consumers will see an added 2.01 cents per litre on heating and stove oil pricing, an added 2.8 cents a litre on diesel prices and a huge 6.6 cent a litre hike in gasoline pricing,” said Murphy

“In spite of inflation fears, investors are still betting on increased demand of fuel products. That, and a failing US dollar have also helped in supporting pricing to consumers that will be very noticeable later this Thursday morning with anticipated increases on the way.

Watch out for the gas and go
“With the increase in pump prices about to hit, consumers should be aware of the person next to them fueling up who may attempt the “gas and go”, a common type of theft whenever there is a run-up in pricing. As in other years, consumers have to be aware of the fact that this is a type of theft that gets passed down to the consumer in added costs to service stations. We can help avoid this problem by being aware of who you are filling up next to and making note of who the person is and what kind of car they are driving, getting the necessary data for . The last thing we need to see as consumers is the cost of theft being passed down to the consumer.”

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For more information, contact;

George Murphy
Consumer Group for Fair Gas Prices

Update #2

All numbers are up...

One more day of numbers to get and here's what I have...

• Heating and stove oils up by 1.92 a litre.
• Diesel up by 2.7 cents per litre, and...
• Gasoline up by 6.3 cents a litre.

Yes...

Going to be a line-up at the pumps again Wednesday night...

I'll be back in here sometime after eight tomorrow night with the final but don't expect to see much change...

Regards,

George

Update #1

Just wait for later this week!

If you think we just might get the rout at the pumps later on this week when the PUB sets prices again, you'd be right.

With oil prices increasing and with no signs of abatement, it's looking more positive that we're going to take quite the jolt when they are set Thursday morning. To put it mildly, when we skipped out on interruption to pricing, we just missed getting a four cent a litre hit at the pumps.

Since then, oil and all it's related refined commodities, have also increased in value.

Here's what I have for this coming Thursday, keeping in mind that I have to get two more business days of data before I call the final shot on Thursday;

• Heating and stove oil prices to increase by 1.85 cents per litre.
• Diesel prices increase by 2.6 cents a litre, and...
• Gasoline to increase by 6.1 cents a litre, so far.

Yup...

Hurts...

Talk about hijacking economic recovery...

Regards,

George

Will prices spike this week?
Numbers show interruption a possibility

Media release

Conception Bay South, NL, June 10, 2009- The rise in oil prices this last week may leave a very sour taste in the mouth of consumers, that’s according to George Murphy, group researcher with the Consumer Group for Fair Gas Prices.

“I’m seeing a steady rise in the price of oil and its related commodities and that doesn’t bode well for consumers. While some numbers are close to my margin for error, I’m putting out a recommendation that we all err on the side of caution this time out because of the volatility of the markets these past few weeks. I’d much rather I was wrong more so than right sometimes,” said Murphy.

What consumers can expect this Thursday
“Numbers show large increases on the way. Heating and stove oils are expected to increase by 4.37 cents a litre, diesel by 4.7 cents a litre and gasoline by another 4.9 cents a litre. My actual on gas before the addition of taxes shows a 4.17 cent a litre increase, so that’s why the call of ‘erring on the side of caution’ in this case. The margin for error would bring it below the 4.17 cent a litre margin and hence, no increase this week. The possibility of an increase however, is much more likely than not.”

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For more information, contact;

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

Update #2

Prices slightly up for this week
Increase in prices renews concerns over added fuel surcharges

Media release


Conception Bay South, NL, June 02, 2009- Most fuel prices will probably increase on Thursday but that’s not the big worry. The creep up in all fuel product prices is renewing concerns that some companies may be forced to consider the likelihood of adding fuel surcharges to account for the latest increases in prices.

Marine Atlantic costs to go up?
George Murphy, group researcher for the Consumer Group for Fair Gas prices says that businesses operating within the province should be concerned that there is a possibility that some costs will be increased because of the extra costs for fuel in recent weeks, leading to the possibility of added fuel surcharges again.

“We’re keeping an eye to Marine Atlantic who will be making the decision on added fuel surcharges later this month. The first time they did that back in 2007; prices for most marine type fuels were averaging close to 35 cents a litre when a fuel surcharge of two per cent was applied to passenger fares. As of the first of June, 2009 those numbers exceed that of 2007 by almost 2.5 cents a litre, creeping upwards in recent weeks and showing no signs of abatement. The province should immediately be concerned about any addition to prices crossing the Gulf and should be taking steps to ensure these costs are not going to be passed down to the consumer or to businesses in the province. We also have a very important tourism season to protect,” said Murphy.

“Our federal representatives should press the government in Ottawa to help the Department of Transport and the minister responsible, John Baird, absorb these added costs to Marine Atlantic. If they can step in to the automotive industry with financial assistance, they can help Marine Atlantic absorb the additional costs of marine fuels. We’re seeing the numbers increase and we still have time to deal with anything that is forth-coming provided the federal government is receptive to protecting the province from added increases to rates.”

On the consumer front
“Consumers in Newfoundland and Labrador can expect to see an added 1.77 cents a litre to heating and stove oils, an added one cent a litre to gasoline prices and 1.9 cents a litre on diesel fuels as a result of this past two weeks market activity. Even though numbers show inventories of crude oil almost 50 million barrels more than the average, prices continue to climb as a result of positive economic news. They may be positive for the provincial treasury but, it’s not so positive for the consumer when we see the removal of disposable income from the consumer’s pocket.”

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For more information, contact;

George Murphy
Group researcher/Member