Bloated prices at the pumps
Yellowknifers paying more for gas than many smaller towns
by Jeff Colbourne
NNSL (Apr 03/98) - The price of oil may be fluctuating now but Yellowknifers should not expect any sudden decreases in pump prices.
In fact, Yellowknife shows no sign of losing the distinction of one of the most expensive cities in the country when it comes to fuel.
The price of OPEC's basket of crudes -- the market's yardstick -- fell to $11.42 US a barrel on March 23 from $18.81 in November.
The decrease only lasted a few days and on Monday Texas Light Crude stood at 16.88 a barrel.
Donna Kraus-Hagerman, a spokesperson for Shell Canada said crude fluctuations usually have little effect on Yellowknife pump prices.
"You haven't seen the volatility in the past couple of months and that's because the western part of Canada is on a different wholesale orbit than the East," said Kraus-Hagerman.
"They're two separate markets and you really can't compare the two."
Gasoline prices depend on three different levels of competition: crude oil price, wholesale price and local retail market dynamics.
While Eastern Canada prices are most susceptible to foreign price changes, the West tends to weather such storms more easily.
Kraus-Hagerman said in the North high transportation costs and low volume means retailers need to jack up gas prices to make a profit.
"Depending on competition it all boils down to competition and your marketplace as well as the influence of wholesale pricing. That will determine what your pump prices are."
Last August, Northern News Services randomly surveyed a number of gas stations in the North to determine where Yellowknife fits in the overall gasoline market.
In some cases, Northerners were paying 25.5 cents more per litre than Edmontonians, who enjoy some of the lowest gas taxes in the country.
Yet even those cities more comparable to Yellowknife, such as Whitehorse, which is just as remote in terms of distance from suppliers enjoy significantly lower prices. (Both Yellowknife and Whitehorse are supplied by Edmonton.)
Earlier this week Yellowknifer conducted another survey to determine gas prices in towns and cities across Canada compared to prices for gas in Yellowknife.