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Gas shortage spikes prices in Yellowknife
Commuters feeling the heat as pump costs increase once again

Robin Grant
Northern News Services
Friday, June 10, 2016

SOMBA K'E/YELLOWKNIFE
The high price at gas stations in Yellowknife is part of an increase occurring across Western Canada because of a shortage in the U.S. Midwest and Alberta, says Dan McTeague, a petroleum analyst for gasbuddy.com.

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Yellowknife resident Dave Hurley fills up at the Esso gas station. With the cost of living in the city so high, he says it would be nice to have lower gas prices. - Robin Grant/NNSL photo

Vehicle owners filling up in the city have no doubt noticed the price has risen to 124.9 cents/litre as of Thursday afternoon - a drastic rise since the record low in January of 97.5 cents.

"Out of the U.S. Midwest there is a perception that there might be tightness in supply," explained McTeague. "A few refineries are having difficulty producing gasoline, but it's probably, more importantly, just those who have gasoline are holding on to it - unless they get more money for it."

"So you see gasoline jump up about 50 cents a gallon just in the past three weeks, which works to be 15 cents a litre," he said.

Canada gas prices are usually pegged lock-step with the U.S. Midwest, he explains.

"Chicago is the hub for all gas and petroleum pricing. So the mirror image of the U.S. Midwest is all of Canada from the B.C. Pacific Coast in the west to Northwest Territories all the way back down to Thunder Bay, Ontario."

Last week, Suncor Energy experienced a shortage at Petro-Canada stations across western Canada, resulting from a shutdown at a refinery in Edmonton, significantly curtailing its production, he says.

And gas prices are expected to keep rising with increased demand this summer, as people hit the roads.

"U.S. demand is way up, breaking new records in terms of miles travelled," he said.

"We're getting awfully close to high demand not seen since 2007. So with the U.S. economy strong and supply somewhat weak, you can continue to see upward pressure on gasoline prices."

The current price in Yellowknife is still seven cents cheaper than last June, McTeague adds.

"It feels like it's getting high again," said Dave Hurley, filling his vehicle at the Esso gas station on Franklin Avenue.

"It was nice, you know, when it dropped there a few months ago. I mean it seems to be creeping up again. With the cost of living in Yellowknife, it would be nice to see a lower gas amount for sure."

"It's stupid," said Alan O'Reilly at the Yellowknife Co-op gas bar.

"It's stupidly high ... expensive. It shouldn't be allowed."

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