Gas Pricez

Solution to the Gas Prices

Harper May Slip on Gas

On the horizon: $100-a-barrel oil. While supply is still almost able to meet demand, that must end. This makes oil that is expensive to extract and deliver, such as Alberta tar sands, look attractive. And it is why Canada and B.C. will permit oil and gas exploration off the Queen Charlottes.

This is also why George Bush is in Iraq and is spoiling for a fight with Iran.

High oil prices will have a huge, adverse impact on Ontario, while creating a huge windfall for Alberta, which isn't at all interested in giving a break to Ontario industry, already in trouble with the rising Canadian dollar and the ravages of globalization.

We've seen this movie before. Back in the '70s oil costs suddenly soared under the friendly eyes of Sheikh Yamani and the OPEC cartel, which brought about this bit of irony. When the world oil market went in the dumper in the '60s, Ottawa forced consumers, especially in Ontario, to pay Alberta more than the world market value. This federal generosity was quickly forgotten when prices ballooned and Alberta could charge Ontario world prices again.

As the price soared, the Trudeau government was under tremendous pressure from Ontario to lower oil bills. Energy Minister Marc Lalonde brought in the National Energy Program (NEP) in 1980, which had as its stated purpose to increase both Canadian control and Canadian ownership of the energy industry while piously declaring that it sought to protect all Canadians from surging oil prices.

Lalonde proposed measures such as price controls and federal taxes on oil and gas production, which would increase federal government control of petroleum.

Unsurprisingly, Alberta and B.C. saw this as a federal takeover of a natural resource through the back door. Which it was. The bumper sticker of the day in the far west was "Let those eastern bastards freeze in the dark."

To make matters worse, Lalonde and Trudeau were clearly enjoying sticking it to Alberta and B.C., which have never been much loved by Liberal governments and didn't matter politically anyway.

The NEP was abandoned by the Mulroney Tories but by that time the world price of oil had fallen so much it didn't matter anymore.

Today, as the world price of oil rises, Mr. Harper will face precisely the same problem Pierre Trudeau did. With this added wrinkle: his Liberal predecessors didn't grab at all resources in all provinces -- just oil and gas. Ottawa would never get away with that today and the PM knows it.

But what can't be done up front, must be done by stealth. Thus the trial balloon that defines provincial wealth under the equalization formula by including the value of their resources, something not hitherto done. And that indeed does amount to taxing oil and gas by the back door. But if, unlike the NEP which only grabbed oil resources, the feds nail "resources" period, Ontario Premier Dalton McGuinty, unlike his predecessor Premier Bill Davis at the time of the NEP, will see his province as being richer, thus liable to pay more towards equalization.

Mr. Harper is in a bind. His power base is in Alberta and British Columbia and he doesn't want to alienate them by grabbing at resource revenues. On the other hand, he can't win an election without Ontario, which will be alienated if he doesn't help them.

As John Kennedy said, "there are days when leaders earn their salary."

Gas Prices Rise Ahead of Long Weekend

Gas prices gained as market participants worried by the approach of the US summer driving and hurricane seasons purchased oil contracts ahead of a long weekend.

Crude oil rose 26 cents to US $71.58 a barrel.

The market in New York closes early Friday and will be shut Monday in observance of Memorial Day, the unofficial start of the summer driving season, when gasoline demand peaks.

Market participants said the prospect of an active hurricane season - which starts June 1 - is another factor pushing gas prices up.

Last year's hurricane season damaged key oil infrastructure in the U.S. Gulf of Mexico, including Hurricane Katrina's severe disruption of the flow of oil and natural gas from the region, and the shutdown of onshore refineries and pipelines.

Worries about summer supply shortages were reignited by reports of refinery snags, offsetting US government data that showed gasoline inventories rose for a fourth consecutive week.

Gas Prices the Truth ...

A Nice View

Ottawa Needs Gas Tax Cut

Ottawa needs to stop gouging drivers and cut the fuel tax.

In its eighth annual plea for Ottawa to reduce fuel taxes, the federal government needs to set aside 50 % of fuel taxes for roadway development while cutting the gas tax by 5 cents a litre.

Taxes accounted for about 35 % of the pump price over the past 12 months -- taxes that need to be reduced and targeted to roadway improvements.

Taxpayers would be more than happy to pay these taxes if they knew those taxes were going back into our highways.

That is not the case. Only 11 % of the federal money collected on gasoline actually goes back into roads.

We wants Ottawa to eliminate the 1.5-cent-per-litre deficit elimination tax and remove the GST charged on gas taxes.

We're very optimistic with this new government because they've been talking the talk, now they've got to walk the walk.

Stephen Harper had previously criticized the Liberal government for failing to reduce gas taxes.

However, since taking office, Harper has avoided cutting the tax saying Ottawa's one-per-cent reduction in the GST will have a similar effect to a fuel tax cut.

Ottawians Support Gas Prices Regulation

Many adults in Ottawa believe the federal government should regulate fuel prices directly. 72 per cent of respondents support the measure in order to protect consumers from unfair pricing.

On Apr. 21, the price of an oil barrel reached a record high of $75.35 US. On May 19, the cost was $68.53 US.

Last week, a survey of 60 Canadian communities found that Whitehorse has the highest gas prices at $1.07 U.S. per litre, and Calgary the cheapest at 84 cents per litre. The average cost for a litre of gas in the country is 92 cents.

In April, Canadian prime minister Stephen Harper discussed the situation, saying, "I think we’re going to see sustained upward pressure on gas prices for some time to come. This is something we’re all going to have to adapt to and it’s one of the reasons why when we deal with climate change and other issues, we’re going to want to encourage the development of alternative energy sources." 67 per cent of respondents think Canada’s government could act to limit increases in the price of gasoline.

Polling Data

1) In response to recent increases in gasoline prices, some people have said that gas prices should be directly regulated by the government to protect consumers from unfair pricing. Other people say that the government should not directly regulate gas prices and leave it to the marketplace. Generally speaking, would you, yourself, support or oppose direct government regulation of gasoline prices?

Support regulation: 72%
Oppose regulation: 28%

2) Do you think Canada’s government could act to limit increases in the price of gasoline, or do you think Canada’s government is really helpless when it comes to increases in the price of gasoline?

Could act: 67%
Helpless: 18%
Not sure: 15%

Iran Rejects UN's Call for Direct Talks With US

Iran rejected a call by UN Secretary-General Kofi Annan for the US to hold direct talks with the Islamic Republic about its nuclear program.

"The US isn't prepared to have talks on a one-to-one equal basis. They are following the politics of threat. So under these conditions we see no necessity to start talks with them", Iran said.

Annan on May 5 said Iran might be more willing to negotiate in direct talks with the US The UK and France, backed by the US, proposed a resolution to the UN Security Council on May 3 demanding Iran cease uranium enrichment, and said they would seek sanctions should the government in Tehran fail to comply.

"Iran won't accept a resolution that fails to recognize its right to a peaceful nuclear program, Asefi said today. Should the Security Council adopt the proposed resolution it would decrease Iran's willingness to cooperate with the International Atomic Energy Agency", Iran said

Suspension of Iran's nuclear activities is "definitely not on Iran's agenda", Iran said.

Iran reiterated it may quit the Nuclear Non-Proliferation Treaty if it faces further international pressure to abandon its nuclear program.

Russia and China, two veto-wielding members with close economic ties to Iran, reject reference in the draft to Chapter Seven of the UN charter and allusion to Iran's nuclear program as a threat to international peace and security.

Chapter Seven provides for the "severance of diplomatic relations", "interruption of economic relations" and the "use of armed force".

The US accuses Iran of seeking to build weapons under cover of a civilian atomic program. The Islamic Republic insists its nuclear ambitions are peaceful.

$4 for a Gallon of Gas?

If gas prices follow trends from past years and peak around Memorial Day, drivers may avoid paying the dreaded $4-a-gallon price this summer.

But because the current spike in prices was not expected, there's no telling what gas prices will do this year.

Typically, prices spike in spring. That's when refineries make a costly switch from their winter blend to a cleaner-burning summer blend. Production at refineries then goes up in late spring.

Since mid-February, gas prices have been rising for a variety of reasons. Oil and gas traders had concerns over civil strife in the oil-producing regions of Nigeria, Iran was making efforts to develop nuclear weapons, and ethanol was becoming more in demand because many refiners outside of California started using it for the first time this year.

It appeared that gas prices were coming down at the end of April. Wholesale prices then spiked tremendously as retailers, worrying about a lack of supply, started buying more than what their long-term contracts allotted.

Even if gas does not reach $4 a gallon this summer, it likely will in the future.

China and India and other developing countries are also expected to increase their demand for oil — leaving the United States to compete for a smaller piece of the pie.

Ottawa Cuts Home Energy Efficiency Grants

Ottawa government has quietly axed a program to help low-income households cope with high energy costs.

EnerGuide for Low Income Houses (EGLIH), a $500-million, five-year initiative introduced with all-party support last November, is the 14th Kyoto climate accord program to bite the dust.

All climate change-related initiatives are being re-examined to make sure they will achieve results for Canada. The government decided not to continue with the delivery of the EGLIH program because they're looking at options. The organization has been told grants already approved under EGLIH will be honoured, but no new ones will be given. EGLIH is the last thing I would have imagined them cutting.

The program would have helped 130,000 low-income households cut their energy bills by an average of 30 per cent, while reducing individual household emissions by 30 per cent.

PM Stephen Harper has condemned the Liberals' Kyoto-implementation plan as ineffective, promising to replace it with a new "made-in-Canada" plan to curb greenhouse gas emissions.

The government has already cut 13 climate programs, including the One-Tonne Challenge advertising campaign. Rumours of additional cuts are running rampant in the environmental community.

Green Communities, an association of 40 community groups, has written to Harper pleading for the home retrofit program to be preserved.

Without EGLIH, Canada will have no strategy to protect low-income households from escalating energy prices, and no strategy to engage these households in the effort to reduce energy-related pollution. But EGLIH is cost-effective and made-in-Canada is practical and realistic.

If EGLIH is cancelled, it will be a serious blow to a great many organizations, agencies and businesses that have invested their own resources in good faith to begin delivering the program.

The five-year EGLIH program is modelled on the popular EnerGuide program which provides subsidies for home-owners who retrofit their houses, but the incentives are more generous. The EnerGuide program remains in place for now.

No comment was available from PM's office or from Environment Minister.

How to Save On Gas

Here are some tips:

• Shop around and check out the competition.
• Be a better driver and drive safely. You can increase your gas mileage by as much as a third by driving safely. Stick to the speed limit for fuel-efficiency. Your gas mileage decreases rapidly at speeds above 60 mph.
• Tune up your car and save some money at the pumps. A simple tuneup on your car can improve your gas mileage by an average of 4.1 percent. Also, fixing certain parts of the car can dramatically improve your gas mileage of as much as 40 percent (K&N Cold Air Intakes, Performance Exhaust Systems and Performance Mufflers, Electronic Upgrade, Inflated Tires, Synthetic Motor and Transmission Oil, Oxygen sensor, Iridium Gears and Spark plug wires).
• Drive your most sensible compact car.
• Pack light. Take all unnecessary weight out of the car. An extra 100 pounds in the trunk reduces a typical car's fuel economy by 2 percent. Don't place anything on top of the car. A luggage or a loaded roof rack creates wind resistance and can reduce your gas mileage by 5 percent. Keep items inside the car.
• It could still be cheaper to fly. Price a flight to your destination and compare it to your estimated cost of driving.

Oil Prices Fall Dip Below US$70

Crude Oil futures turned higher Friday in electronic trading after falling nearly $5 a barrel earlier this week on U.S. government data that showed an increase in gasoline supplies.

Gas prices gained 1.79 cents to $2.1025 per gallon.

Prices had plunged $2.33 Wednesday after the U.S. Energy Department released its weekly report showing a supply rise as refineries boost output and demand flattens.

The report showed that over the past four weeks, average daily gasoline demand in the United States was 9.127 million barrels per day, barely higher than year-ago demand of 9.125 million barrels a day.

It also showed that domestic inventories of gasoline climbed by 2.1 million barrels, reversing eight straight weeks of declines.

Many analysts believe the government data point to a consumer response to U.S. pump prices that exceed $3 a gallon in many parts of the country.

While Nymex oil futures have fallen more than $4 from their intraday peak of $75.35 reached April 21, prices remain roughly 40 percent higher than a year ago and analysts do not expect them to free-fall anytime soon given the high level of geopolitical tensions.

The most pressing source of anxiety in the market stems from the possibility that Iran could cut supplies because of international pressure to modify its nuclear program. Unrest in Nigeria, violence in Iraq and rising resource nationalism in South America have added to oil market worries.

Some 500,000 barrels per day of Nigerian production, most of it operated by Royal Dutch Shell PLC, remains off-line because of violence there, and more than 300,000 barrels per day remains shut down in the Gulf of Mexico since Hurricane Katrina battered offshore platforms in August.

Strong global demand and a limited supply cushion magnify the significance of these events, while a surge of investors betting on oil and other commodities has also lifted prices.

NWT Gas Pipeline Will Go Ahead

The 1,200-kilometre pipeline would run from the Mackenzie Delta in the Arctic to the Alberta border.

The addition of the new supply would help restrain gas price increases across the country.

Ottawa threw more support behind the pipeline in the federal budget handed down on Tuesday.

The federal Conservatives announced a $500-million, 10-year fund intended to help offset costs for its construction and operation for communities along the proposed route.

Oil Prices Settle Above $72 a Barrel

Oil prices tanked by more than $2 a barrel Wednesday, May 3 after U.S. government data showed gasoline supplies rising for the first time in two months as refineries ramp up output and demand flattens.

But oil prices remain about 46 percent higher than a year ago, and analysts do not expect them to fall sharply anytime soon.

The most pressing source of energy-market anxiety stems from the possibility that Iran, a key exporter, could cut supplies because of international pressure to modify its nuclear program. Strong global demand, a limited supply cushion and persistent production outages in Nigeria and the Gulf of Mexico have also exerted upward pressure. And a surge of investors betting on oil and other commodities has exacerbated the run-up.

World Crude Oil Prices Surged to Near US $74

New York's main contract, light sweet crude for delivery in June, rose 1.82 dollars to close at 73.70 dollars a barrel. On London's ICE Futures exchange, the price of Brent North Sea crude for June delivery was up 1.87 dollars to finish at 73.89 dollars a barrel.

Traders are concerned about the possibilities that Iran's oil exports would halt if the United Nations imposes an international sanction on Teheran for its nuclear activities.

Also, Bolivian President Evo Morales issued a formal decree to nationalise crude and natural gas resources. The measure is expected to affect about 20 foreign oil companies, including Spain's Repsol, Petrobras of Brazil, Britain's BP and British Gas and French group Total.

Bolivia has the second-highest natural gas reserves in Latin America, behind Venezuela. It has an estimated 54 trillion cubic feet of natural gas reserves.

Oil Prices Rise $72 a barrel

Oil prices rose May 1 on supply concerns arising from Iran's defiance of a UN Security Council deadline to stop enriching uranium.

Crude oil for June delivery on the New York Mercantile Exchange rose 82 cents to $72.70 US a barrel in morning trading. Prices briefly dipped below $71 last week after surging above $75 the week before that.

Once prices retreated toward $70, we saw the speculators come back in.

Iran, OPEC's second-largest oil producer, has said it does not intend to halt oil exports as a political tactic, but some traders fear it's a possibility if the dispute escalates, which would most likely cause oil prices to rise.

June Brent crude oil at London's ICE Futures exchange rose 58 cents to $72.60 a barrel in light holiday trading. Trading was thin due to a legal holiday in Britain.

Also supporting prices are shrinking U.S. gasoline supplies, strong global demand and supply disruptions by separatist rebels in Nigeria, the fifth-largest source of U.S. oil imports.

Gasoline futures added 2.08 cents to $2.11 a gallon while heating oil prices advanced 1.51 cents to $2.0280 a gallon. Natural gas futures climbed 21.5 cents to $6.77 per 1,000 cubic feet.

Crude-oil prices are about 40 per cent higher than a year ago. But accounting for inflation, prices are still about 20 per cent below the records reached in 1981, when supplies became tight after a revolution in Iran and a war between Iraq and Iran.

Gas Prices Slashed by 25 percent in Saudi Arabia

Saudi King Abdullah issued a decree Sunday lowering domestic gasoline prices by about 25 %.

The drop in prices means Saudis now will pay 60 halalahs per liter of regular gasoline, or about 60 cents per gallon. The price of super unleaded drops to about 76 cents a gallon. There are 100 halalahs in the Saudi riyal, which is worth about 26 U.S. cents.

The statement said the king issued the decree to ease the "cost of living burden on Saudi citizens."

The big reduction in gasoline prices in the world's largest oil producing nation was announced as prices in oil importing nations reached record levels and oil company profits soared to all-time highs.

The price of a gallon of regular gasoline in the United States now tops $3 in some regions.

Saudi Arabia has the world's largest known reserves of crude oil and is the current largest oil producer.