Mind-boggling gas price increases and fluctuations have motorists now paying around $1.30 per litre at the pumps which, in some cases, might affect how some are using their vehicles.
Consumers are confused about why gas prices keep rising while the price of a barrel of oil has fallen below $100. In response, federal Industry Minister Tony Clement has promised to bring refiners, distributors and retailers before a parliamentary committee to explain the formula behind the pricing that is such a sore point. But should that even happen, count it as a symbolic gesture only, because their explanations, for one thing, won’t make any sense, and they definitely won’t bring the price down.
The short answer to what is causing the increase is that our western oil sheiks seem to use any kind of upheaval anywhere as an excuse to raise the price of gas here. They will tell us that gas price increases rest on a number of factors, one being the falling U.S. dollar which means a higher price being paid for crude oil. Then there is the ongoing political instability in the Middle East which they will say is influencing speculation in wholesale markets as well as the recent flooding on the Mississippi River which could cause oil refineries in the U.S. Gulf states to close. If this should happen, they will say, gas supplies would be cut even further, with lower supplies equaling even higher prices.
For the government’s part, new consumption taxes which amount to some 30 per cent of what you pay at the pump, will be explained away as it always is. They will say that if they reduce the taxes, the big oil companies will just raise their prices to fill the void. Where have we heard that before? Oh, yes, just about every time the prices have skyrocketed. Obviously, big oil doesn’t wait for government tax cuts to raise prices at the pumps.
The hard truth is that gas prices are not going to go down. While our gas prices are relatively high to what we paid in the past, motorists in Europe pay even more, with a huge chunk of what they pay being taxes. We can be thankful that we are not driving cars in the Netherlands where gas is more than $2.50 a litre. In England, motorists have seen the price of a litre of gas at $2.34, more than half of that being in taxes. On the other hand, in Venezuela, the cost of a litre of gas is 7 cents. But who wants to live in Venezuela (with due respect to the Venezuelans among us).
So despite Clements’ grandstanding, governments won’t intervene because the higher the price the more money they make. And with Ontario facing a deficit, does anyone really believe that Ontario Conservative leader Tim Hudak, if he becomes premier, will be able to keep his promise to do something about gas prices; or the Ontario New Democrats for that matter?
The other group happy with the increases are the environmentalists because, they believe, when the price goes up fewer people will drive and fewer cars on the road equates to less of an environmental impact. Never mind that there are so many working poor who need their automobiles to get to and from work or to actually do their work. Why should that bother them?
What we need to do is to come up with less expensive ways to use our vehicles, for example only for the necessities as many people have said they are currently doing and carpooling where it is feasible. But even then the costs might still be prohibitive for some.
And while it would be great to think that public transit offers a solution, it does not work for everyone, for example late shift workers such as nurses, and especially during our cold winter nights. In any case, expanding public transit to make it a viable option for more people is already proving to be prohibitive. And moving nearer to work or working from home won’t be an option for most.
The development of renewable energy alternatives must become more of a priority and the sooner the better.