May 24 Gas Prices

This morning on the radio I heard that gas prices in Toronto have hit $1.10 for the long weekend. Apparently, demand goes up over the weekend. Funny then that it always takes a long time for the price to come back down. Dare I mention the fact that prices still have not returned to normal from the hike after the refinery fire.
It's hard for me to respect the Conservative refusal to lower gas taxes. I can understand why they won't. After all, the government takes 33% of the price of gas plus GST. That's not exactly peanuts. In light of the recent budget, the government needs that money to pay for its programs and a host of other things.
Still, I have to be honest: I don't really buy the supply-demand argument. Certainly it does affect prices to some degree. I understood the price hike after hurricane Katrina. I understand some of the price hikes when there are wars in the Middle East. However, I would like to know what is affecting the supply now. There is always a slight increase in the demand at this time of year, but this does not account for the dramatic change in price over the last two or three years.
The government should take a smaller piece of the pie. They should also do something to limit gouging.


Mark said...

The thing for me is the CPC has talked a lot about tax breaks but hasn't really anted up. I am having trouble believing they would really introduce meaningful tax breaks even if in a majority situation. The tax milk is just too sweet and effortless.

R. Alexander said...

Oil companies aren't burdened by the spirit of the free market. Like the banks, it's more a collusive enterprise in which everybody gets rich. Don't get me wrong... I'm not saying capitalism is bad. Only this isn't capitalism, it's a state-sponsored monopoly. There's little argument that gasoline is a member of the free market when Esso offers it for $1.10.3 per litre and PetroCan for $1.10.4.

violet said...

$1.10 - and you're complaining? Last weekend prices were up to 1.28 here (BC) - down about .08 yesterday. Which is another thing I don't understand about these prices. Why the inequity between east and west?

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