SOMBA K'E/YELLOWKNIFE - While the global recession has lowered the price of many commodities including gasoline, the prices at Yellowknife's pumps are still the highest among major centres in Canada.

Kent Morton fills up his tank at the Co-op Gas Bar on Tuesday, July 21. This year’s gas prices are 18 per cent lower than last year’s, but Yellowknife’s are still the highest in the country, according to MJ Ervin and Associates, an analysis and consulting firm specializing in petroleum. - Tim Edwards/NNSL photo

That confirmation comes from Calgary-based MJ Ervin and Associates, an analysis and consulting firm specializing in petroleum.

The average pump price in Yellowknife in mid-July was 121.2 cents per litre. In Edmonton, the price was 86.5 cents per litre.

As of last Tuesday, the average price across the city had dropped to 117.4 cents per litre.

"I think gas prices being slightly higher up north is justified," said Yellowknife driver Kimberly Woytiuk. "But when our neighbours to the south of us have gas that's nearly 30 cents a litre cheaper, it just doesn't seem fair. We're really not that out of the way."

Though not that far from other cities, Yellowknife is far from the oil refineries and that, according to Michael Ervin, president of MJ Ervin and Associates, is a big factor in the price at our pumps.

"It's because of two factors," said Ervin. "One certainly is the isolation, which causes (the cost of) the transportation of fuel from the refinery to retail sites in Yellowknife, for example, to be very high. Much, much higher than in the case of retail stations (in larger urban areas) that typically are just a two or three hour drive from the nearest refinery."

"The second factor is that retail gas stations in smaller, more remote markets tend to pump much less gasoline than, let's say, a typical gas station in Toronto, which might pump 10 million litres a years. Most gas stations in Yellowknife I doubt would be pumping even one million litres of gasoline per year."

Ervin said, as a result, retailers charge a higher mark-up. Still, overall gas prices are much lower this year than last year.

"We saw a drop of 18 per cent - that would be June 2009 from June 2008," said Kate Odziemkowska, labour market statistician with the NWT Bureau of Statistics.

Ervin said this is because the price of crude oil has dropped due to the recession, and because of a decrease in demand.

"The economic climate has led to lower consumption of not only gasoline by people driving cars but also fuels used for industrial purposes," said Ervin. "As manufactured good activity declines, so does the demand for fuels that drive those industrial engines."