Why gas is more expensive even though the price of oil has remained steady
A recent spike in gas prices has Winnipeggers feeling pain at the pumps but the latest jump comes despite the price of oil remaining relatively steady.
That has many wondering why they’re paying more.
Experts said it’s due to refinery outages and some expect the price hike won’t last very long but that’s little comfort for people and businesses who’ve been dealing with volatility at the pumps.
With the price hovering around $1.85 per litre, up around $0.15 since last week, drivers filling up their tanks are feeling sticker shock.
“Well, like everybody else a little upset but we have to do what we have to do,” said Pete Coss, after filling up his van. “We gotta get to work, we gotta get home, we gotta go pick up stuff so we deal with it, I guess.”
Except this time around, experts said fluctuations in the price of oil can’t be blamed, with the cost hovering around the US$80 per barrel mark.
Werner Antweiler, a professor at the University of British Columbia’s Sauder School of Business, told CTV News Winnipeg this spike is due to refinery outages — some scheduled, others due to technical problems.
“The good news is that this temporary price spike won’t last very long,” Antweiler said in an email. “Notice that diesel prices have not gone up, because there appears to be still sufficient inventory. We can expect prices to ease in the next two to three weeks.”
It’s not just Winnipeg, prices have surged across the country, according to the Canadian Automobile Association (CAA).
In B.C., prices rose to $2.35 per litre in Vancouver, while Toronto is seeing gas go for an average of $1.52 per litre.
“There’s a lot that goes into the price of gas,” said Teresa Di Felice, assistant vice president of government and community relations at CAA. “Crude oil doesn’t always translate into the issues of what we’re actually experiencing at the pump.”
Winnipeggers were paying around $1.69 last week. This latest spike has hit hard, especially for businesses in the transport sector.
“Our customers depend on us for reliable, consistent and affordable pricing and so we’ve actually been consuming a lot of the fuel costs ourselves in order to continue to provide that service they’ve come to depend on,” said Evan Martin, vice president of Calculated Moving.
He said their fuel prices have nearly doubled since early in the pandemic when the cost of gas dropped amid decreased demand. It accounts for about 50 per cent of the company’s overall costs. It’s now impacting the business’s ability to grow and electrify their fleet of trucks.
“Previously that wasn’t really something that was on our radar but now that we’ve seen how much fuel can actually play an impact in our day-to-day costs that’s definitely something that we’ve come to consider going forward as the technology continues to evolve,” Martin said.
He’s also noticing customers changing the way they live due to swings in fuel prices.
“We’ve seen people actually end up moving closer to the core areas to rely more on different transit methods: biking, walking, rapid transit, stuff like that,” Martin said. “We’ve actually seen a lot of our customers locating to a place where they’re moving away from independent fuel use.”
Martin said the price of gas is also affecting employees. He said the company’s trying to be more flexible by arranging to pick up some workers from home instead of having them drive out to their compound just west of Winnipeg to start work.
Coss said for him it’s just a matter of being more efficient with his trips when he does choose to drive.
“You start figuring everything out and taking time and making sure everything is done on a routine so you’re not backtracking too much,” he said.
CTVNews.ca Top Stories
'I just can't believe that it took so long': Body found in wreckage 3 months after deadly fire
A man accused of arson in a January Old Strathcona apartment fire is expected to be charged with manslaughter after a body was discovered in the burned building late last month.
No proof man lied to brother about number of kittens born in litter, B.C. tribunal rules
A man was denied a $5,000 payout from his brother after a B.C. tribunal dismissed his claim disputing how many kittens were born in a litter.
Quebec police hand out hundreds of tickets to Hells Angels and other bikers before 'first run' meeting
Quebec provincial police handed out hundreds of fines to Hells Angels members and other supporting motorcycle clubs who met for their 'first run' in a small town near Sherbrooke, Que.
Grandparents killed in wrong-way crash on Hwy. 401 identified
A 60-year-old man and a 55-year-old woman killed in a wrong-way crash on Highway 401 earlier this week have been identified by the Consulate General of India in Toronto.
Snakes almost on a plane: U.S. TSA discovers a bag with small snakes in passenger's pants
According to an X post by the Transportation Security Administration, officers at the Miami International Airport found the small bag of snakes hidden in a passenger's trousers on April 26 at a checkpoint.
A Chinese driver is praised for helping reduce casualties in a highway collapse that killed 48
A Chinese truck driver was praised in local media Saturday for parking his vehicle across a highway and preventing more cars from tumbling down a slope after a section of the road in the country's mountainous south collapsed and killed at least 48 people.
Russia puts Ukrainian President Zelenskyy on its wanted list
Russia has put Ukrainian President Volodymyr Zelenskyy on its wanted list, Russian state media reported Saturday, citing the interior ministry’s database.
Britney Spears 'home and safe' after paramedics responded to an incident at the Chateau Marmont, source tells CNN
A source close to singer Britney Spears tells CNN that the pop star is 'home and safe' after she had a 'major fight' with her boyfriend on Wednesday night at the Chateau Marmont in West Hollywood.
‘We made them safer and more fun’: Here’s what’s new about e-scooters
Electric scooters (e-scooters) have been gaining popularity in the capital and this season comes with some changes and updates.