Toronto wakes up to higher gas prices. Who’s to blame? Everybody
With prices jumping to $1.20 per litre in some places—having risen almost five cents in two days—Toronto is facing prices similar to the summer of 2008, right before the last recession started. Who gets the blame depends very much on who is being asked. Here, a rough roundup of the potential suspects.
Libya: While it’s a relatively small oil exporter (exporting less oil than Canada, itself a small player next to giants like Russia and Saudi Arabia), the chaos in Libya has the markets nervous. As much as it’s possible for business pages to come to a consensus on anything, this is the short-term explanation for the last few days.
Everyone else: But wait! Oil prices were heading up at a gallop well before the recent unrest in the Middle East. (And why isn’t “unrest in the Middle East” considered a permanent condition at this point?) Between a recovering economy in the West and rising markets in China and elsewhere, there’s just too much demand.
Oil companies: If the BBC is to be believed, the big oil companies have long failed to invest in more and better refining capacity. Basically, OPEC countries have some spare capacity to replace Libya, but it’s lower-quality oil that Western refineries can’t handle. Some are calling shenanigans, saying this is an excuse for OPEC to do nothing but sit back and count its money.
Saudi Arabia: It’s not possible to talk about oil production without talking about the Saudis, so let’s. According to documents released by WikiLeaks, the kingdom simply doesn’t have the ability to grow its production higher than its 2008 peak—contradicting claims made by Saudis and Western energy analysts alike that there was room to grow. If the Saudis can’t open the pipes, then the global economy is in for a nasty, protracted shock. And someone owes Jeff Rubin a beer.
Fortunately, Toronto has been far-sighted and working tirelessly to reduce its dependence on gasoline with construction beginning on a city-wide network of light rail lines the War on the Car is over.
• Oil Crisis? [Metro Morning]
• How long will gas prices remain high? [Toronto Star]
• Toronto gas prices soar [Toronto Sun]
(Image: Mike Gifford)
2 thoughts on “Toronto wakes up to higher gas prices. Who’s to blame? Everybody”
I think the only way to be less dependent and affected by gas prices hike is to change our commuting travelling habits. Either to use commuter transit systems if available or to form a carpool. I tried the driving cost calculator of the carpooling network ( http://www.carpoolingnetwork.com ) and they suggest huge savings for carpoolers: up to 2000$ and 1,5 tons of GHG per year.
I think as Canadians we are don’t take a stand on issues. Like affordable daycare, insurance premiums, minimum wage, credit rating systems, and the cost of gas. We need to band together and push our government to change. I luckily make a decent living and can manage with the higher costs of living, but for the average household income, all these things combined can make for a struggling day to day. It adds to stress, people taking on second jobs, spending less time with their families and so many other negative side effects. Life should be for living, not working just to pay the bills. Our government needs to step in and either increase minimum wage so people can just survive. Or allow the average household to be able to make ends meat and do I dare say “save for retirement”. That’s a whole other issue. These price hikes in common day to day items and needs have to stop.
Comments are closed.