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Gee, what a surprise. Last time I checked, the oil producing regions of Canada aren’t providing their product to Canada at a discount to help reduce gas prices

Gee, what a surprise. Last time I checked, the oil producing regions of Canada aren’t providing their product to Canada at a discount to help reduce gas prices here. That would reduce their profits, violate fiduciary duty, blah blah blah.

Danieru 5y ago
Oh but they are. Alberta's producers are forced to sell at a discount due to low/no pipeline capacity. What keeps Canada's gas prices high are lack of refining capacity. Much of Canada's oil is shipped down south, refined in America, and sold back to Canadians.
- jleyank 5y ago
  I would check this as there is refining capability throughout Canada to handle local consumption. Shipping refined gas is a problem as it goes boom too easily, Canada needs the pipelines to get their product to market as Alberta is landlocked. Newfoundland has open access but it’s at the back of beyond. Edit: https://www.cer-rec.gc.ca/en/data-analysis/energy-commodities/crude-oil-petroleum-products/report/2019-gasoline/index.html https://www.cer-rec.gc.ca/en/data-analysis/energy-commoditie... Turns out that building key pipelines in other countries is stupid as a Canada to Canada pipeline went through the us. Probably cuz it was cheaper and who would have thought there’d be a difference of opinion between neighbours.
  - Danieru 5y ago
    Nice reference. It even has a page with historical graphic data showing the gradient in gasoline prices. In 2019, the newest year, it lists Edmonton at 118.9cents and Vancouver at 167.4cents. A rather massive gradient considering in theory these two markets are connected by pipeline. Note how Kamloops, also in BC and subject to the same taxes, is at 139cents.
- jleyank 5y ago
  It’s also tougher to refine. Heavier than the good stuff which frustrates the producers.
coldcode 5y ago
If you own producing wells the cost is mostly constant other than transportation; if the price goes up, you make more money. Pricing for gas is different, the price is dependent on the price of crude, the availability of refining, the distance from refining to the pump, and demand for driving. Thus the price fell off of a cliff during the pandemic since no one went anywhere. The price of crude is dependent on demand and supply. The price of crude was $20-25 lower before the war started which is likely more economic; it went up because Russia is a large supplier and losing/reducing that supply caused the spike. People love to blame a market when the price goes up and forget to blame the market when the price goes down. At one point during the pandemic the futures price crashed below zero. No one complained. You may not like oil companies, but oil is about as basic a market as you can get as long as there is no collusion (aka cartels like in the 70's). Arguing we should no longer use crude for burning is different; I'd rather see renewables to provide energy and heat.

Danieru 5y ago

Oh but they are. Alberta's producers are forced to sell at a discount due to low/no pipeline capacity. What keeps Canada's gas prices high are lack of refining capacity. Much of Canada's oil is shipped down south, refined in America, and sold back to Canadians.

jleyank 5y ago
I would check this as there is refining capability throughout Canada to handle local consumption. Shipping refined gas is a problem as it goes boom too easily, Canada needs the pipelines to get their product to market as Alberta is landlocked. Newfoundland has open access but it’s at the back of beyond. Edit: https://www.cer-rec.gc.ca/en/data-analysis/energy-commodities/crude-oil-petroleum-products/report/2019-gasoline/index.html https://www.cer-rec.gc.ca/en/data-analysis/energy-commoditie... Turns out that building key pipelines in other countries is stupid as a Canada to Canada pipeline went through the us. Probably cuz it was cheaper and who would have thought there’d be a difference of opinion between neighbours.
- Danieru 5y ago
  Nice reference. It even has a page with historical graphic data showing the gradient in gasoline prices. In 2019, the newest year, it lists Edmonton at 118.9cents and Vancouver at 167.4cents. A rather massive gradient considering in theory these two markets are connected by pipeline. Note how Kamloops, also in BC and subject to the same taxes, is at 139cents.
jleyank 5y ago
It’s also tougher to refine. Heavier than the good stuff which frustrates the producers.

coldcode 5y ago

If you own producing wells the cost is mostly constant other than transportation; if the price goes up, you make more money. Pricing for gas is different, the price is dependent on the price of crude, the availability of refining, the distance from refining to the pump, and demand for driving. Thus the price fell off of a cliff during the pandemic since no one went anywhere. The price of crude is dependent on demand and supply. The price of crude was $20-25 lower before the war started which is likely more economic; it went up because Russia is a large supplier and losing/reducing that supply caused the spike. People love to blame a market when the price goes up and forget to blame the market when the price goes down. At one point during the pandemic the futures price crashed below zero. No one complained. You may not like oil companies, but oil is about as basic a market as you can get as long as there is no collusion (aka cartels like in the 70's). Arguing we should no longer use crude for burning is different; I'd rather see renewables to provide energy and heat.