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momomx3v6 wrote:here in holland is it 6.80 a gallon!!

CarMan1 wrote:man, at this price driving a car with all kinds of performance upgrades is gunna kill money lol... thats insane..i feel for u guys with turbo'd cars, and the big v6 swaps atm....

Source: Toronto Star
Editorial: Gas price increase defies explanation



The light rain in Toronto yesterday morning was the last feeble breath of Hurricane Katrina, which earlier devastated the Gulf Coast of the United States, some 2,100 kilometres away. Yet gasoline prices in the Toronto area and throughout Canada spiked as much as 20 per cent yesterday morning from Wednesday night. At some downtown Toronto stations, regular gasoline was selling for $1.20 a litre.

Looking for a reason why this was happening, a member of the Star editorial board drove from station to station, asking operators why their prices were so high. The answer was always the same. As one station manager told the Star, the order to jack up prices came from the oil company.

We then went to several oil company websites, all of which explain how gasoline prices are set. They all start off with government taxes, which accounted for 39 per cent of the price of a litre of gas in 2004. But federal and provincial excise taxes have not increased in the last year and they have not changed in the last two days. While the GST component of a litre of gas may have increased a bit, it does not go up unless something else does.

What has risen is the price of crude oil, which has increased by about 8 per cent to nearly $70 a barrel since Hurricane Katrina hit.

Of course the gasoline in the underground tanks below every station came from crude oil that was purchased, refined and delivered long before the hurricane hit. But even ignoring that essential fact, an 8 per cent increase in the price of crude oil cannot explain a 20 per cent overnight increase in the price of gasoline.

Oil companies say crude oil costs account for 42 per cent of the price of a litre of gasoline, which implies the post-hurricane spike in crude prices should not have pushed gasoline prices up more than 3 per cent.

The remaining factors affecting gasoline prices are the costs of refining and marketing, which have not changed much in Canada in recent days.

For many Canadians, the only thing left in the list of factors underlying gas prices that could account for yesterday's huge 20 per cent jump is company profits or, as many suggest, price gouging.

Liberal MP Dan McTeague (Pickering-Scarborough East) says refiners in Canada have raised prices well above what he calls a "catastrophic level." He wants Prime Minister Paul Martin to impose a temporary freeze on gas prices because they aren't justified. And Ontario Premier Dalton McGuinty says Ottawa should provide some form of temporary relief from the high gas prices, possibly by lowering federal taxes on gas sales.

At the very least, Martin should order oil company leaders to Ottawa to explain their pricing policies. And the CEOs should be fully aware that they are facing a public relations disaster unless they can explain why a small jump in crude prices results in a 20 per cent overnight jump in the prices at the pumps. Canadian motorists deserve an answer.