Gassing up goes down
Price at the pump drops as much as two cents
NNSL (Dec 09/98) - Finally, the price of fuel at the pump has gone down in Yellowknife.
Gas is going for 69.9 cents a litre at the Midtown Esso.
Midtown dropped the price Sunday from 71.9 cents, co-owner Ida Duncan said.
Contrary to what people think, gas station operators do not make big bucks selling gas, she added. And, when it comes to Midtown lowering its price, its a decision made locally, she said.
Duncan said once she lowers the price at the pumps, she then calls Esso's territorial manager and sees if they will lower the price she pays.
"We decided to take a chance and lower it (two cents)," she said. Esso did respond by lowering how much it charges Midtown, but not two cents, she added.
A big part of the price of a litre of gas is taxes, she said.
Federal and territorial taxes make up about 25 cents of the per litre costs. Crude costs are about 12 cents. Other parts of the price include refining, as well as dealer costs such as local taxes and wages for employees.
Local Petro-Canada marketer Brian Harrison said the lower cost of crude is definitely behind the reduced prices.
Crude oil is trading at its lowest price in about 20 years. The spot price for crude was $11.48 a barrel yesterday morning.
Petro-Canada dropped its per litre price by one cent to 70.9 late last week. Five other stations have not lowered their prices by midday Tuesday.
With crude prices low, "we have said consumers will see some movement," said Judy Wish, government and public affairs director with the Calgary-based Canadian Petroleum Products Institute, said.
Per litre costs are high in Yellowknife because "you have huge transportation costs," she said.
Stations in smaller centres charge more because they don't sell as much gas as stations in big cities, she said.
Due to increased competition, the nation's cheapest gas -- about 46 cents a litre of which 28 cents is tax -- is likely in Vancouver.
Esso bulk agent Northshore Petroleum's Shawn Delaney suggested consumers buying home heating oil should compare prices.
Home heating oil is more tied to market forces like supply and demand, he said.
When you're paying $1,200 to $1,500 a year for up to 6,000 litres of heating oil, a cent a litre or less makes a big difference, he said.
Delaney said prices for home heating oil in Yellowknife can be different from company to company.
"Shop around," he said.