An expert in the petroleum industry says more pain at the gas pumps is on the horizon as vaccine rollouts ramp up and demand increases.
George Murphy, of Consumers for Fair Gas Prices, says as people get their COVID-19 vaccine they are making travel plans and the industry sees an opportunity – not to mention OPEC has slashed production which has artificially created pressure on the markets.
Over the past year, gas prices plummeted to below 80 cents per litre in Nova Scotia due to low demand as the pandemic put a halt on travel. However, those prices have been on a steady incline and have jumped up to pre-pandemic levels within the last month.
It’s expected this will be the trend heading right into the summer.
Murphy says the higher prices are not going hold people back after months of restrictions and isolation. He adds people are anxious to get out and move around and they won’t hesitate to pay the price.
“We’re talking about increased demand because people are going to be moving a lot more as they get their vaccine,” explained Murphy in an interview with our newsroom. “I don’t think fuel prices are going to hinder people in the least when it comes to travel and in saying that…the price is going to go up.”
Murphy says he was a bit surprised regular gas went up 6.1 cents in one adjustment last week to smash the $1.30 per litre barrier in Nova Scotia. He had predicted an increase of three to four cents per litre.
“There are many factors in play. We’re seeing refinery disruptions, weather related events in Texas and we’re seeing heavy demand and market speculation with the vaccine rollout and speculators are betting on heavier demand in the summer as well.”
Diesel prices went up as well, and now are sitting at $1.20 in many community in Nova Scotia.
He says given the large increase was coming at the same time of the weekly setting, it wasn’t a situation where the Nova Scotia Utility and Review Board would use its interrupter clause.
It’s a mechanism the board uses when there are steep increases or declines in the market greater or less than six cents.
