Forcing prices up

In a lesson on how to control pricing and in an effort to help control the latest decreases in oil pricing, US refiners hatched a plan: reduce refinery production of gasoline to stop the fall in prices.

So far, it appears that the plan may be working...

Even though crude oil appears to be lower than in days past, refinement of gasoline has been cut, refiner capacity dropping almost 3 per cent in the last week and that has led to a drop in available gasoline so much so, that today, inventories as reported by the US Energy Information Administration dropped by some 110, 000 barrels. That, combined with robust demand figures that show gasoline consumption averaged just 1.7 per cent below the same time last year, are two chief indicators of what could happen next.

If Big Oil is making a concerted move to reduce production, then it is only reasonable to assume that the plan to support domestic retail pricing in order to support future profits, is working. We may be a little negligent into our own reality of pricing, thinking that we're going to see low pricing for a while. It may very well be that in this case, where Big Oil has let it be known that they're not going to produce gasoline where there is plenty of inventory, we've all become a little too used to prices below a buck a litre.

Maybe it was wishful thinking that prices did fall and would stay down for some time...

The truth is, after today's news from the EIA, it may have been a fleeting dream to most and a stark reality at the pumps in the coming weeks, that gas below a buck a litre was all such wishful thinking after all. The ground has been set and the only factor in the markets that can affect Big Oil's latest move is a drop in demand or worsening economic news that will affect that demand.

No one wants worsening economic news but, are we, as consumers, prepared to cut back on our own needs and affect the demand numbers and help turn the tide back in the consumers favour again?

A buck a litre could be home to stay sooner again than what we think...

Regards,

George

Not much change in the numbers

Media release

Conception Bay South, NL, January 27, 2009- Consumers in the province will hardly notice the changes when the PUB moves to set prices this coming Thursday, but that’s not necessarily a bad thing.

“The numbers, with all the data in now, are nothing substantial and that’s not a bad thing. We’d like to see prices dropping and, although they’re not dropping substantially, gasoline will be dropping close to 1.1 cents a litre. After today’s market activity along with all the bad economic news, there will likely be a gradual slide further downwards in pricing over the next few days for all fuels.

“Heating and stove oils are predicted to see an added 8/10ths onto current prices but it’s not expected that the fuels will see another increase in the coming weeks. Even though we’re deep into the demand season for these types of fuels, they are being mitigated by the other fuel I the distillate group of fuels, diesel, that shows a slight drop of 7/10ths of a cent. With the worsening economic news and anticipated inventory builds, I expect to start to see future declines in all petroleum products in the next couple of weeks.

No budget breaks
“Consumers of fossil fuels, who have been the singular positive influence in any economic recovery, failed to see any substantive tax breaks that could have meant something to any economic recovery. The recent drop in fuel prices from year-ago levels has been the singular largest factor in giving consumers back some disposable income and we should have seen more tax relief to consumers as an emergency measure in today’s budget. We’re still subject to taxation on heat and major transport fuels and we’re still paying artificially high prices on consumer items as a result.

“We also didn’t hear anything as regards to government lifting the remaining fuel surcharge off Marine Atlantic rates. Again, we’re still seeing the remaining nine per cent fuel surcharge added to consumable goods into the province and that adds an artificial inflation rate onto goods and services into Newfoundland and Labrador. Marine Atlantic is our highway. Where is the infrastructure money for our ‘highway’ to Nova Scotia?

Inventories remain high
“Inventories of all fossil fuels remain high in spite of the news from some oil companies that they will begin to reduce refinement of products, particularly gasoline. Inventories climbed again last week for the eighth week in a row and another build in crude stocks along with refined product is expected for tomorrow. I fully expect that, if the inventory reports are positive tomorrow, that we’ll be in line to witness the markets come back to economic reality on oil and that we’ll witness further declines in oil pricing.”

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For more information, contact;

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

Not much change...

Hey, Big Oil. Can you spare us a dime?

Six of seven days of data for gasoline and 13 days worth of the same for both heating/stove oils and diesel, all show minimal changes to come this Thursday.

One more day to finally call the shot on the changes, but here's what I have so far:

• Gasoline shows a drop of close on a penny a litre.
• Heating/stove oils are up by 1.06 cents a litre, and..
• Diesel to drop by 1.7 a litre.

We'll have a full run-down on the final tally tomorrow night. Drop in and see me then!

Regards for now,

George

Update #2

Commodities prices spike
Expect interruption to pricing Thursday night

Media release

Conception Bay South, NL, January 20, 2009- Oil prices may have lost some of its steam but the price of it’s related, refined commodities like gasoline continues to climb. Again this Thursday, the Petroleum Pricing Office may very well be forced to use the interrupter formula to adjust prices upwards as a result.

“According to our numbers, prices may rise by as much as 6.1 cents a litre in spite of the recent drop in oil prices. Traders are continuing to bet that demand for refined products will pick up and that’s helping to keep the spot price of gasoline elevated,” said George Murphy, group researcher with the Consumer Group for Fair Gas Prices. “Six days out of seven days data needed, are showing a marked increase in spot prices against the backdrop of oil over the last week.”

“Other markets have seen a steady increase in gasoline pricing as well, some areas by as much as what we’re expecting for Thursday morning. We don’t expect immediate movement on heating, stove oils or diesels but those numbers will probably have increases to retail pricing when prices are adjusted again next week. Right now, they don’t meet the criteria for interruption as gasoline.

“If there is any glaring evidence that traders and investors are responsible, then this is it. In the face of ugly economic news and falling demand, the trader and investor continues to help support refined product prices and that is only helping to thwart any possibility of economic recovery. Until the numbers accent the reality of the world economy, consumers will always feel that they are being taken for a ride as they have been from the last couple of weeks energy trading markets.”

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For more information, contact;

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

Update #1

Lost for words...

Prices may increase substantially by Thursday

Believe it?...

I don't either, but it certainly looks like gas prices will spike next week and I simply don't have a valid explaination as to "why".

All the indicators like inventory and consumption, are down and the economic news doesn't allow for the price of oil to sustain itself. There simply isn't reason to explain it when we've all seen oil drop from the mid 40's to the current $36 US a barrel..

All I figure is that some investors out there are putting all their hopes that demand will eventually pick up and that they're hedging for the future. A lot of people must be. I have to note as well that our local business channel here, BNN, has also started turning it's eyes towards the March buying contracts and they've given up on carrying daily oil pricing, focusing instead on the "months ahead".

Seems everyone is getting in on the act...

Anyways, pricing so far shows a possible spike in gasoline towards 6.1 cents a litre up, that's with five of seven days data recorded. You need a full seven days before the interrupter formula kicks in.

Be warned!...It's coming!

Regards,

George

Oil trades lower, commodities trade steady
No big drops predicted in spite of lower oil

Media release

Conception Bay South, NL, January 13, 2009- Oil may be trading lower but that doesn’t mean that its related commodities are trading lower too. Consumers in Newfoundland and Labrador shouldn’t expect big changes to pricing when pricing is set this week by the provinces’ Public Utilities Board.

“The numbers are down only slightly in spite of the news from the markets that shows declining demand for most fuel products. Heating and stove oils are expected to see a bare 12/100ths down. Gasoline is expected to drop by close on a half cent and diesel is expected to drop by close on three tenths of a cent,” said George Murphy of the Consumer Group for Fair Gas Prices.

“The only thing I can figure here is that there was a heavy investment in the refined commodity rather than an investment in oil, but that doesn’t begin to reflect the reality of the markets. In the face of dropping demand and bad economic news, the price for the refined commodity traded the same all week. The realities of builds in inventory were outweighed here by the talk of refiners cutting back on refining of crude oil products. They are trying to strike the balance between market need and demand factors. Some call it capitalism; I call it direct market manipulation.

“Last week saw a heavy build in crude oil inventory and that didn’t even factor into the markets as it did the week previous. Add to that the fact that all major refined products all saw inventories increase and you really have to ask yourself why these prices aren’t droping more than what’s being predicted. It’s a little ludicrous when we see the factors of supply and demand not playing into the markets rather than becoming key factors in price drops as they have in other weeks.”

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For more information, contact;

George Murphy

Group researcher/Member

Consumer Group for Fair Gas Prices

gasprices@hotmail.com

Update #1

Numbers don't show anything, really...

I'm often asked whether prices for petroleum products are fairly priced and, this week is no different than any other, but with one glaring exception.

While the numbers don't show major changes in either heating and stove oils (-4/10ths), diesels

(-6/10ths) and for gasoline (-1.2), we can look back on the markets and take a quick look of why prices will hardly be moving this time around. What you figure you'd be looking at is an exact carbon copy of the performance in the markets over the last three weeks.

Not so, even though the movement of crude probably justifies a larger change in the numbers than what we're expecting. What is distinctly noticeable is the amount of risk that some traders have taken all in the vain hope that OPEC cuts will be far-reaching and that inventory reports will start to show deceases in refined product as refineries are beginning to cut back on production.

Justifiably so? If I were an owner of a refinery, that is. I'd be a little concerned about the falling price. That's why we're hearing a little bit more on some refineries cutting back on production, particularly over the last week or so, and that is the difference between this week's numbers and those of two weeks ago.

If you attempt to limit supply, then prices are sure to either steady out if not increase.

Ill post my final numbers here later tonight as to what to expect. Right now, with six days out of seven days worth of data, there's not much there...

Regards,

George

Numbers confirm prices will rise
Consumers to see an increase in pricing Thursday morning

Media release

Conception Bay South, NL, January 6, 2009- Consumers in Newfoundland and Labrador will experience something they haven’t seen in a while, a price increase to most petroleum products. All indicators point to the Public Utilities Board using its interruption formula to adjust prices this Thursday morning.

“All the numbers are in and they’re not good. As of Tuesday’s market close, consumers in the province will likely see an added 5.94 cents on heating and stove oils, 6.8 cents a litre up on gasoline and 8.0 cents a litre up on diesel fuel”, said George Murphy, group researcher with the Consumer Group for Fair Gas Prices.

“This is a substantial increase caused by market investors playing with the same factors we saw in the run-up in crude oil prices a few years back. We’ve been told for a long time now, that supply disruption concerns have always had a built-in price factor. We’re also seeing investors doing exactly what caused the world economic problem as well; investing in oil without regard for the damage high oil pricing can cause the world economy. They have literally removed some disposable income from the pockets of consumers everywhere.

“We’re seeing them play with OPEC cuts and making bets that they’ll stick and cause a shortage of crude in the markets while we haven’t seen the rest of the bad economic news. They’ve bet on a drop in supply when they should have been betting on a drop in consumer demand. Here’s hoping the investor loses his bet come February.”

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For more information, contact;

George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
gasprices@hotmail.com

Update #2
Interruption to pricing possible

Six days out of seven needed for interruption to pricing to occur now show an allowable 5.4 cent a litre increase to heating and stove oils on the way for Thursday morning.

Gasoline shows 6.5 cents and diesel shows an added 7.5 a litre at the pumps for Thursday as well.

All this is coming fast on market traders making bets that OPEC cuts will be adhered to by the 12 member nations in the group. Indonesia was a recent drop-out from the group.

More on how these numbres will look again late tomorrow night but, the writing is on the wall so, fill the oil tanks!

Regards,

George

Interruption to fuel pricing possible

Update #1

From the looks of things, the recent drop in fuel pricing here may have been short-lived.

All data in so far are indicative of the possible use of the interrupter formula by the PUB as of this Thursday. The recent trading of oil, moving from $39 US to Friday's $47 US also showed that refined commodity prices rose right along with the pace in oil.

Heating and stove oils so far, shows an allolwable five cent a litre increase while gasolines show 6.0 cents a litre.

Diesel is showing 7.1 cents a litre upwards.

Not surprising really. I expected that, as there's nothing left to invest in in the markets, the only thing investors have to rely on is good old energy use. I fully expect there to be give-and-take over the next few months.

See how long this one lasts...

We'll have more here on Tuesday night.

regards,

George

Happy New Year!
Pricing will be down on all petroleum products to start 2009

Media release

Conception Bay South, NL, December 31, 2008- Consumers in Newfoundland and Labrador can start off 2009 with cheaper prices for all fuel products measured as pricing is set to take another precipitous drop this Thursday, that’s according to George Murphy of the Consumer Group for Fair Gas Prices.

What consumers will see
“There’s not much change in the numbers from yesterday. Numbers still show heating and stove oil pricing will drop by 5.78 cents a litre, gasoline to drop by six cents and diesel down by 6.9 cents a litre. The news of this next round of decreases will be excellent for the consumer and, we hope that pricing will continue to drop into the New Year”, said Murphy.

Reasons for dropping prices
“Continuing worries over the economy, good inventory builds and dropping consumer demand for petroleum products have all played an active role in prices dropping this week. We’re hopeful that OPEC cuts will not take their full effect until late February which means that it will be too late to be of any worry to heating oil and stove oil users. Add to that, that if the bad economic news continues, OPEC cuts may have no effect at all in the near future. There simply won’t be a demand for crude oil as there won’t be anyone using it in a stagnant economy.

Historical numbers, if mine are right
“If my numbers are right and we see the six cent drop, we will see 79.2 cents a litre at the pumps. The last time gasoline prices were this cheap was back in July 2003 when gasoline was posted at 79.6 a litre. If my numbers are right with heating oil, we will be looking at pricing reflected of March 15, 2003 when the maximum allowable was posted at 62.67 cents a litre. For diesel, the last time I could find pricing this cheap was on February 15, 2003 when diesel sold for 89.5 a litre. It’s been simply a remarkable turnaround since September.”

Time to drop the nine per cent fuel surcharge
“Businesses in the province should start asking some serious questions about how they are charged fuel surcharges on incoming and out-going freight in the new year. Pricing for transportation fuels has come down quite a bit and they should investigate how much of a break these latest drops in fuel pricing should mean to their bottom line, especially with hard economic times waiting in the wings. Because the New Year is pretty much here, we also have to ask Marine Atlantic when we can expect another adjustment downwards to fuel surcharges to passengers and motor vehicle traffic. The final nine per cent fuel surcharge is yet to be dealt with and this is the month that Marine Atlantic was to top up the fuel tanks. Do they have a time-line they can share with the province on when we can expect the final adjustment to occur? The numbers for residual fuel oils, sometimes used for marine applications, have now bottomed close to March of 2005 levels, just two years before surcharges were first applied. It’s now time to remove the additional nine per cent fuel surcharge.”

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For more information, contact;

George Murphy
Group researcher
Consumer Group for Fair Gas Prices

gasprices@hotmail.com

So, with oil up, prices will be up right?...

Wrong!

The last few days have been interesting ones with oil pricing but, hey, that's my fun game!...

Just a little note here and a little notice to some consumers and users of the "update" and the info I publish on the blog here. Numbers are still showing "down" on heating and stove oils (-5.8/Lt), gasoline (-5.9/Lt), and diesel (-7.0/Lt) with one more days worth of data to come.

The latest round of oil price increases are pure speculation on some traders parts as they play on the fact that there is a "possibility" of some kind of supply disruption resulting from the Gaza violence. Last week showed good inventory builds and that played itself through the later stages of last week as well as dropping demand figures. Traders are playing a dangerous game before the OPEC cuts take their full effect in February month so, I'm thinking that oil will drop later this week as investors go for some profit-taking. See if I'm right on that one later.

In the meantime, if I'm not and oil continues to trade higher on spec, then we may experience some small hiccup in pricing a couple of weeks down the road, unless the numbers warrant interruption by the PUB.

The word then?

After this week's drop in heating and stove oil prices, fill those oil tanks!

More on my final numbers late tomorrow night or early Wednesday morning. You might want to check the blog first before relying on your in-box as the mass mailing sometimes experiences delays of 24 hours or so.

Either way, pricing will be down this week, and all in time for New Years!

Regards,

George

****NOTE: I lost a good cheer-leader due to the acts of a drunken driver on December 26th who took the life of my fourty year old co-hort and friend. I just wish people learn to stop their foolish acts and it is to his memory that this update is dedicated.

Farewell friend, you will be sadly missed!

Prices still dropping

No interrupt this week means larger drop next week

Ok, so we missed out this week, but by the barest of margins. That doesn't mean we still won't see something good happen next week.

Nine days of data now show heating and stove oils dropping by 4.75 a litre, gasoline down by 4.7 cents a litre an diesel down by 5.7 cents.

Not bad, but it's just too bad we didn't see Big Oil willingly drop pricing ahead of when prices are to be set again next Thursday.

Nova Scotians will be looking at a price drop again this coming Friday, their regular timeframe for setting pricing.

Oh well...Keep holding off until then!

Merry Christmas to all!

Regards,

George

Early Christmas present?
Numbers still showing possible interruption

Media release

Conception Bay South, NL, December 23, 2008- Consumers in Newfoundland and Labrador may still find that some petroleum product prices dropped overnight this Wednesday, that’s if the numbers show anything.

“Last week we expressed the possibility that some petroleum prices may come down as early as Christmas morning. Some figures are still showing that possibility although, the numbers are real close. Heating and stove oils are showing 3.4 cents down but that number doesn’t reflect the performance of the jet fuel component which is an integral part of the heating oil mix. If those numbers are showing greater movement that those we have, then we are into interrupter formula territory. The problem? We can’t get a read on the jet fuel number which makes up 75 per cent of the heating oil mix. Consumers should take a wait and see approach if they can do it as, if nothing happens this week, we will definitely see downwards moves for next week on heating and stove oils,” said George Murphy of the consumer group.

“As for diesel fuels, those numbers are showing 4.6 cents a litre down, albeit, close to my margin for error. Again, if you are a diesel fuel user, try and hold off until after Wednesday in case there is movement. There is a definite move downwards for this fuel for next week, if interruption does not occur Thursday. Gasoline is showing 3.4 cents a litre down which is slightly outside the requirements for interruption. Again, if pricing here does not change, then consumers can expect a bigger decrease next week instead.

“On a consumer perspective, bad economic news, dropping demand and good builds in inventories of most petroleum products are good reasons that we will see a continuance of the slide in refined commodities. For now, one can hope that Santa Claus will be coming early again.”

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For more information, contact;

George Murphy
Consumer Group for Fair Gas Prices

***NOTE: This one may be delivered to your in-box late as a result of my late posting. I had to work so, it wasn't possible to get the notice out in time for all. Sorry for any inconvenience this may have caused.

Possible Christmas present for distillate users coming.

Numbers already show we're in interrupt territory

Just a short notice to everyone who tunes in, and please pass the word around on this one.

Numbers are showing possible interruption to all distillate products that I monitor such as heating oils, stove oils and diesel fuels. Numbers there are on track, showing a nickel down on heating and stove oils as well as diesel fuels.

Numbers on gasoline are close, now showing over three cents a litre down, the opposite of what happened when pricing increased earlier this week.

If oil trades lower today, we may see a further effect on gasoline, pushing those numbers also into interrupt territory as well.

Tomorrow may very well prove to be the most important trading day this week as some face the prospect of profit taking after a contentious week on the markets. While bad economic news continues to pour from a broken world economy, oil is also facing the prospects of a complete price collapse after the failed round of OPEC cuts. It is quite possible that nothing can be done from preventing oil to reach as low as 1997 levels, that being $17 US a barrel when adjusted for inflation.

That's what certain energy traders get for producing (and betting on) documents predicting $150 a barrel oil in the first place.

Mom used to call it "getting your just desserts"...

I'll post here again later Sunday night just to let you know what data I have after five days rather than just the two I have now. Remember...Seven days needed for interruption to occur.

Regards,

George

Mid week rise in crude to cost consumers
Gasoline to increase, distillates to fall

Media release

Conception Bay South, NL, December 17, 2008- Consumers in Newfoundland and Labrador will experience a slight bump in gasoline prices this week when the Public Utilities Board moves to adjust prices this Thursday.

“The sudden rise of crude oil to near $48 US a barrel Thursday of last week also brought with it an increase in the basic cost price (spot) of gasoline and this is going to affect consumers to a degree. We would have hoped that prices would have kept falling but, bad news and speculation late last week from OPEC and the chance of a major production cut in the offing, both helped to increase spot prices to all fuels. However it is only gasoline pricing that will experience an increase, that amounting to 3.1 cents a litre at the pumps on Thursday”, said George Murphy of the Consumer Group for Fair Gas Prices.

“Numbers show the rapid rise in spot prices that began shortly after the huge adjustment down last week. We also expected to see a much larger drop in distillate prices carrying on from last week but the increase in spot prices mitigated that. Numbers are still showing down by 8/10ths of a cent for heating and stove oils and 1.3 cents a litre down for diesel fuel.

“Since the spike last week, I have recorded a steady decrease, albeit slow, that hopefully will translate into this increase in gasoline as being an anomaly in the petroleum markets. Considering that the markets are now speculating that any OPEC cuts will have no effect on oil pricing, we can hope that there will be further decreases to come for all fuels in the coming weeks. The economic news just keeps getting worse and that has helped to play into market traders fears of lowering demand for fuel products and those fears are slowly translating into fact.”

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For more information, contact;

George Murphy
Group researcher
Consumer Group for Fair Gas Prices
gasprices@hotmail.com

Any comments?

If OPEC cuts production...

Here we go again...

At OPEC's next meeting on December 17th in Oran, it is widely expected that the oil group will institute one of the biggest production cuts that it has ever implemented. Not to be out-done, the group is also asking the wild card in the market, Russia, to meet an "obligation" to help the group put the brakes on the slide in oil prices.

While a distinct possibility that OPEC will bring in a major cut amounting to close to an expected 2 million barrels, I don't expect the Russians to follow suit with OPEC. Russia wants more customers for it's oil and, weaning their way out of any possible OPEC influence just might be the way for the Russians to gain some further world economic influence. Don't expect the Russians to follow suit even though they're just as badly in need of US currency as anyone else. There is a vested interest for the Russians not to follow OPEC's lead as there is to follow the price-fixing cartel.

So, what would the effect be on pricing if OPEC did close the door on some production?

To OPEC, there is no sense in allowing further export of a product that, right now, is in low demand. The danger to OPEC here is that oil will rise again and bring a renewed interest in oil fields that have a higher initial capital cost to them. In other words, keeping the price low would effectively keep other oil fields from being developed. If I were an OPEC member, there can be no doubt that I would attempt to sway fellow members into letting oil freely flow, at least at present levels, and help keep the price of oil low for the sake of keeping other projects off the radar.

Witness Alberta...

With major projects in the oil sands being shelved and workers heading back to their home provinces and countries, it would be a little inopportune for OPEC to help support the price and help keep the projects going. OPEC needs to get these workers out of Alberta and help keep Alberta from being a major supplier to Uncle Sam. It would be a very long re-start before any other fields open in the tar sands if OPEC simply waits the ebb-tide out. That's why it's not likely that Russia won't follow the OPEC lead; there's a chance for the country to gain more influence on oil sales to the US.

December 17th, we'll find out if OPEC will really pull the trigger...

But, if they do cut in the face of the most recent economic news, the markets simply haven't paid OPEC too much attention in the face of a prospect of a two million barrel per day cut. While oil has increased in value by about five bucks since last Thursday's price change, it has since fallen back by another three to sit at $44 bucks US. In other words, while we might see a slight hiccup in prices, it's not likely that OPEC is going to impact price until Russia joins in the fray and then, they both might have more to lose. There's a prediction out there from the International Energy Agency that says consumption of oil will be 500,000 barrels per day less as a result of the downturn in the world economy and they don't have the full scope of the economic damage yet. After all, after losing $103 US a barrel since the first week of July, does anyone?

********************

Six days out of seven show little change in heating/stove oils, just a bare cent down on diesel and a rough 2.9 up on gasoline. I'll have more concrete numbers later tonight so, look out for the press release then!

Regards,

George

Update #3:

An early Christmas present on the way
Consumers to see substantial drops in all petroleum products

Media release

Conception Bay South, NL, December 9, 2008- The numbers confirm it. Interruption to all fuel pricing will occur Wednesday night on heating and stove oils, gasoline and diesel fuels, and the drops there will be substantial, that’s if the numbers that the consumer Group for Fair Gas Prices have been tracking are any indication.

What consumers should expect
“According to the numbers, heating and stove oils will see a drop of 8.25 cents per litre while, gasoline will drop by close to 8.3 cents a litre. The real gift to the Newfoundland and Labrador economy may very well be for diesel as that fuel is projected to drop by a whopping 10.5 cents per litre after taxes are accounted for”, said George Murphy, group researcher for the consumer group.

“We can say fairly that, with the drop in diesel pricing, areas of the Newfoundland and Labrador economy should start to see the removal of some of the fuel surcharges that they were forced to pay for the movement of goods and services that affect the consumers in the province. Diesel prices have now dropped by almost 35 per cent against the peak prices paid in early July. Our fishing industry should be able to catch gains from cheaper transportation costs as well as the difference in the Canadian dollar against the US greenback as well.

“OPEC last week, failed to come to any agreement on any substantial cuts to production as overall demand for oil has dropped along with the ill performance of the world economy. There still lies a chance that OPEC will make some sort of drastic cut when they meet again on December 17th. Some gains in inventories have been realized in recent weeks except for last week, which showed the first draw-downs on available refined products in North America in some time. It is my belief that there is enough available inventory of heating and stove oil inventories to make it through the rest of the winter so, I don’t expect to see any substantial increase in heating and stove oil prices unless OPEC steps in to address world over-supply or demand for distillate fuels show a great increase. Any further drop in refiner capacity which was measured at just over 84 per cent, may also affect distillate supply. A drop in production wouldn’t be surprising if Big Oil knew it would help support the price of the refined product either.

Fuel surcharges
“As the busy Christmas travel season is about to start, consumers should be asking serious questions about the last remaining fuel surcharges on things like air travel and Marine Atlantic ferry rates. It should not be acceptable for Marine Atlantic to let fuel surcharges wait until January to be lifted when they place their orders for fuel at that time. They can easily place an order for fuel now and have the difference in fuel prices reflected back to the amount of inventory then on hand and adjust the surcharges accordingly. Why wait until January to bring relief to the consumer and industry who use the service?

NL Power should adjust pricing
“When will we hear from Newfoundland Power or the Public Utilities Board on any adjustments to electricity with the drop in crude oil prices? It’s about time we hear from them to find out what the consumer can expect to happen to electricity rates in the coming weeks. Businesses will be forced to pay an additional 50 cents an hour to wages and, I’m sure that they can use the savings from electricity rates to help defer the costs of higher minimum wages in these tough economic times. Consumers will also expect to see lower electricity rates to hand in hand with the heating relief program just introduced by the government.

Some crude facts
1) The last time spot prices were this low for heating and stove oils was recorded on September 19th, 2006 when spots hit a then record 48.95 cents a litre.
2) The last time spot prices for gasoline hit this low was on June 14, 2002 when the spot price was recorded at 30.22 cents per litre.
3) The last time crude oil traded close to yesterday’s close of $42.07 US was on July 28th, 2004 when it closed at $42.80 a barrel.

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For more information, contact;

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

Still on track for a big drop in pricing

Update #2

Hi to all...

Six days data out of seven days needed for interruption to occur are now showing the following after todays trading:

1) Heating/stove oils to drop by 8.02 cents a litre.
2)Gasoline down by 8.1 cents a litre, and
3) Diesel down by 9.0 cents a litre.

While oil traded up almost $3.00 a barrel US, the Canadian dollar showed strength and picked up almost four cents against the US greenback. Even though spot prices picked up in value with extensive trading on the markets, the difference in the dollar against Friday's finish was enough to absorb any shock to refined commodity prices and the numbers failed to move when converted over to Canadian values.

I expect the prediction to hold after tomorrow's trading and for the interruption to pricing to happen this Thursday as predicted.

I'll be in touch with an official press release tomorrow night with all seven days of data and the final numbers then.

regards,

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

Interruption to pricing now likely

UPDATE: Looks like all fuels regulated under the guides of the Petroleum Pricing Office will face interruption this week coming. Here's a breakdown of what's likely to occur this Thursday.

You might want to spread the word on this one as the numbers are substantial here:

• Heating/stove oils show 8.0 cents a litre down so far.
• Gasoline shows 8.1 cents a litre down.
• Diesel shows almost 9.0 cents a litre down.

With two more days of information to come, I don't expect the numbers to change too greatly but, be warned that anything could happen out there in the markets and the data could change. They may even be greater than what I have here now.

Regards,

George