Travelling around Saskatchewan, one sees different prices for gasoline in many communities.
Recently in Moose Jaw, the gas prices ranged from $1.357 a litre to $1.35.9 a litre.
In Regina, the price ranged from $1.19 to $1.31.9.
In the southern communities of Weyburn, Estevan, Assiniboia, and Carlyle, price averages were $1.31.9. Drivers in the central community of Outlook pay $1.35.9.
Drivers in Yorkton paid $1.35.9. Swift Current prices were $1.33.9.
PrinceAlbert’s price ranged from $1.24.9 to $1.30.9.
Something is wrong with this picture.
The supermarket flyers in this province have one price throughout Saskatchewan. A century ago, the T. Eaton Company catalogue managed to have one price for all of Canada.
Why can’t the petroleum industry do the same thing?
The industry will argue price differences come from varying provincial taxes and transportation costs.
The federal government charges 10 cents a 10-cent-a-litre tax. Saskatchewan charges 15 cents. Provincial gas taxes vary from nine cents in Ontario to 27.5 cents in parts of B.C.
All gasoline sold in Moose Jaw and much of the province comes from the Co-Op Refinery in Regina.
Some trucking costs may be involved, but does it really cost four cents a litre to move gas from Regina to Moose Jaw?
It seems obvious there are three reasons for price differences between communities — competition, transport cost and the ability to squeeze a little more profit from captive buyers often living in smaller communities.
Unfortunately, the smaller communities tend to have less competition and lower incomes, thus paying a larger portion of income for gas.
They tend to buy more as they have to travel long distances for work or shopping.
A study from the right-wing Fraser Institute shows the impact of gasoline prices on three income streams.
People with incomes of $32,100 or less put out 22.1 per cent of income on gas — $1 of every $5 income.
Those with incomes between $35,000 and $83,000 spend 13.1 per cent of income for gas. The highest level over $127,000 pays 1.6 per cent for gas.
An argument can be made for the provincial government to regulate gasoline prices at one price across the province.
The ability to set one price exists. Five provinces successfully regulate prices for gasoline and diesel, with some regulating heating oil and propane.
Varying regulations exist in Quebec, Nova Scotia, New Brunswick, Prince Edward Island and Newfoundland and Labrador.
The regulations didn’t create lower prices but leaves consumers with a sense of fairness that nobody is getting ripped off by the petroleum companies.
People in rural communities, which have less competition and traditionally high prices, get a little break.
And buyers know what the price will be for a fixed period.
Quebec sets a minimum price weekly with an allowance for transportation costs.
New Brunswick sets a maximum price every Wednesday with allowances for retail margins.
Nova Scotia sets prices weekly and sets retail margins between four cents and five cents a litre.
Newfoundland and Labrador sets gas prices monthly with allowances for retail margins and transportation in 18 regions.
Ron Walter can be reached at [email protected]
The views and opinions expressed in this article are those of the author, and do not necessarily reflect the position of this publication.
