Gas Price Regulation

[Wilber]

So New Brunswick puts a cap on gas prices. Do you think the oil companies will care? They will just sell it somewhere else. It's not like there isn't a market for the stuff.

[geoffrey]

So New Brunswick puts a cap on gas prices. Do you think the oil companies will care? They will just sell it somewhere else. It's not like there isn't a market for the stuff.

Exactly right. If it were a market like Ontario or say California, it would be a different issue no doubt. What's the population of NB, one maybe two million? I don't think oil companies could care less, there is plenty of people will to pay alot more for the gasoline.

The law will likely be repealed and the Liberals will now likely win the election by highlighting the incompetency of this plan. Too bad.

[jbg]

The US's experiment with gasoline price controls was instructive. Prices dropped by about 7 cents per litre, from about $0.33 to $0.26, within weeks after the end of controls in 1981. During controls, we had two major spasms of gas lines at the pump (December 1973 - February 1974 and May-July 1979).

Case closed.

[Big Blue Machine]

The government should not help the consumers in anyway, except the poor and pensioners.

[Jerry J. Fortin]

It costs what it costs. Either buy it or don't. Just realize that it takes fuel to move things around, so that increase will trikle down to the price of toilet paper sooner or later.

[geoffrey]

It costs what it costs. Either buy it or don't. Just realize that it takes fuel to move things around, so that increase will trikle down to the price of toilet paper sooner or later.

Half the problem is in hording and ignorant people, we are our own beasts when it comes to gas prices.

All of us have heard someone at the office chime "better go fill up your car, prices are going up due to [insert event here]!"

Everyone goes buys gas in a perceived crisis and prices go up. Check the stats, most prices are due to demand pull rather than supply push.

[cybercoma]

Well, there's a bunch of gas stations in NB refusing to sell gasoline as long as it's regulated. They're claiming they will lose money. This is a humourous turn of events.

Humourous? Geoffrey rightly predicted the result.

The next step will be for the government to pass a law to forbid hording and to require gas stations to sell available gasoline. To preserve customer loyalty, some stations may resort to rationing (five litres per customer).

New Brunswick may well become a textbook example.

Setting prices didn't work for the Soviet Union, so I fail to see how it will work for New Brunswick either. You and everyone else with half a brain is right...this is just going to spiral out of control.

[Charles Anthony]

Setting prices didn't work for the Soviet Union, so I fail to see how it will work for New Brunswick either. You and everyone else with half a brain is right...this is just going to spiral out of control.

How long will it take people to abolish minimum wages?

[Jerry J. Fortin]

Setting prices didn't work for the Soviet Union, so I fail to see how it will work for New Brunswick either. You and everyone else with half a brain is right...this is just going to spiral out of control.

How long will it take people to abolish minimum wages?

Okay I will bite, how does that pretain to gas price?

[geoffrey]

Setting prices didn't work for the Soviet Union, so I fail to see how it will work for New Brunswick either. You and everyone else with half a brain is right...this is just going to spiral out of control.

How long will it take people to abolish minimum wages?

Should be abolished, it's a leading cause of unemloyment in many areas of Canada. You choose the price you work for, this isn't some economic depression time, it's your choice.

Price controls don't work there either.

[Rue]

An increase of one dollar to the price of a barrel of oil produces a l cent increase in the price of oil on the markets. That is a fact. What is also a fact is that the market place now determining the price of oil is in a complete state of economic chaos.

What used to happen was that Europe and the Americans would influence OPEC, the oil producing council of countries and use their political influence to control the price of oil on the world markets. OPEC would increase and decrease oil production depending on the influence exerted by the US and/or Europe and oil prices would then go up or down. Yes when the production of oil went down and therefore the existing supplies of oil went down, the price went up so the Americans would try prevent dramatic price increases by increasing the supply through increased production.

Some major things have happened. First of all, as a result of Iran's decision in the last four years to try control the world oil market's prices, it deliberately convinced the greedy Europeans to turn on the Americans and change the world trading currency for petrol from American dollars to Europ dollars.

This in itself has caused major economic problems.

What has also happened is that oil commodity brokers have broken loose and are simply establishing the prioce of oil on the commodity markets through panic and emotion.

Many people think there is an illuminati of oil conspirators that sit in some back-room and manipulate the world markets and there may be some truth to that but right now what we are seeing are commodity traders driving the price of oil sky high for no logical reason.

While Saudia Arabia and Iran continue to be major oil suppliers, so are the Libyans, Russians, Canada, and Venezuela. Oil production is healty and there is NO SHORTAGE OF OIL SUPPLIES contrary to what people may think.

The Oil commodity trading experts in Canada are stating that they do not think oil prices will continue to rise and that we have peeked.

Its hard to know who to believe.

What does not make sense is the following-there is no direct corelation between what is going on in Israel with the price of oil world wide. Many are saying oil costs are increasing in anticipation of war but that is just not true. If oil prices are rising it is because someone is doing a great job of using fera and panic to drive up the prices and make a fortune. Oil production and supplies are quite healthy world-wide and despite the disaster in Iraq, oil from that country is also flowing.

Russia is on the verge of finalizing a deal with Turkey and Israel that will send oil through a pipe-line via Russia and Turkey to Israel for export to Europe.

If anything, India's and China's dramatic increasing demands for fuel is the real cause of unstable oil prices and even that is not the full reason for what we are seeing right now.

As for Atlantic Canada, there is no excuse, absolutely no excuse, that the Irving Empire has been allowed to monopolize the distribution of oil and shut down any competition.

It will also be interesting to see if Newfoundland goes the way of Alberta and turns itself into a little pathetic colony of US oil multi-national interests and cowtows to some fools in Tulsa, Oklahoma, or takes on an international approach with its oil and truly competes on the world markets.

I personally think it is a complete accident but fortunate timing that someone who understands economic market places and comes from an oil producing province, is now the federal Prime Minister at a time when the exporting of oil is going to be a culminating issue that decides the direction of Canada's economy for years to come.

[Jerry J. Fortin]

Give me a break Rue, where do you live in the socialist nanny state of Ontario or Quebec? You do realize theat Alberta citizens subsidize about 90% of the equalization formula for the entire nation. With a quarter of Ontario's population we are paying almost ten times the total they are paying and you dare accuse us of anything!

This is that attitude of eastern Canada, Alberta is beholding to American interests. It has nothing to do with the efforts of the citizens of this province does it? Its just big bad corporate governance......

[Leafless]

While Saudia Arabia and Iran continue to be major oil suppliers, so are the Libyans, Russians, Canada, and Venezuela. Oil production is healty and there is NO SHORTAGE OF OIL SUPPLIES contrary to what people may think.

The Oil commodity trading experts in Canada are stating that they do not think oil prices will continue to rise and that we have peeked.

Naturally your post is well intended but I believe is completely off the mark.

In fact for demand to be appropiately controlled at this time oil prices should be at about $182.00-barrel and gas at $7.00 per U.S. gallon.

What I am talking about is the phenomenon known as global "Peak Oil".

This is a very informative article and is contrary to what Canadian oil commodity experts who must be really kidding themselves if they think oil prices have peaked and our oil supply is plentiful.

http://www.lifeaftertheoilcrash.net/

[Jerry J. Fortin]

The sky is falling!

[jbg]

Setting prices didn't work for the Soviet Union, so I fail to see how it will work for New Brunswick either. You and everyone else with half a brain is right...this is just going to spiral out of control.

How long will it take people to abolish minimum wages?

Should be abolished, it's a leading cause of unemloyment in many areas of Canada. You choose the price you work for, this isn't some economic depression time, it's your choice.

Price controls don't work there either.

I think some minimal minimum wage, say $2 per hour, should be established, simply to prevent slavery. Otherwise I agree.

While Saudia Arabia and Iran continue to be major oil suppliers, so are the Libyans, Russians, Canada, and Venezuela. Oil production is healty and there is NO SHORTAGE OF OIL SUPPLIES contrary to what people may think.

The Oil commodity trading experts in Canada are stating that they do not think oil prices will continue to rise and that we have peeked.

Naturally your post is well intended but I believe is completely off the mark.

In fact for demand to be appropiately controlled at this time oil prices should be at about $182.00-barrel and gas at $7.00 per U.S. gallon.

What I am talking about is the phenomenon known as global "Peak Oil".

This is a very informative article and is contrary to what Canadian oil commodity experts who must be really kidding themselves if they think oil prices have peaked and our oil supply is plentiful.

http://www.lifeaftertheoilcrash.net/

That phenomena has been recited, in varying versions, since the early 1920's. It hasn't happened yet and I doubt it ever will. Oil has historically fluctuated between "real", i.e. current dollar prices of $97 (back in 1980) and about $12 (1970-2, 1986, 1998-9). It may fluctuate closer to the $35 figure, on average, than the $20s in which it spent most of the late 1980's through early 2000's.

Higher, but not the end of the world.

[Jerry J. Fortin]

Thats not scheduled until the next election.......

[Riverwind]

Should be abolished, it's a leading cause of unemloyment in many areas of Canada. You choose the price you work for, this isn't some economic depression time, it's your choice.

Minimum wages force employers to treat employees better so they can get their money back from the wages. i.e. minimum wages encourage employeers to investing in training and other productivity enhancing activities or technology. The net result is both the employer and the employed are better off.

The downside is fewer jobs are created and the unemployment rate goes up. A modest minimum wage like we have now in most provinces is a reasonable compromise between the productivity enchancement and job killing aspects of minimum wages.

[jbg]

Thats not scheduled until the next election.......

The one now scheduled for August 22? (oh, I won't get my hopes up).

[Jerry J. Fortin]

Every free election has the potential to end some partisan world doesn't it?

[Leafless]

Setting prices didn't work for the Soviet Union, so I fail to see how it will work for New Brunswick either. You and everyone else with half a brain is right...this is just going to spiral out of control.

How long will it take people to abolish minimum wages?

Should be abolished, it's a leading cause of unemloyment in many areas of Canada. You choose the price you work for, this isn't some economic depression time, it's your choice.

Price controls don't work there either.

I think some minimal minimum wage, say $2 per hour, should be established, simply to prevent slavery. Otherwise I agree.

While Saudia Arabia and Iran continue to be major oil suppliers, so are the Libyans, Russians, Canada, and Venezuela. Oil production is healty and there is NO SHORTAGE OF OIL SUPPLIES contrary to what people may think.

The Oil commodity trading experts in Canada are stating that they do not think oil prices will continue to rise and that we have peeked.

Naturally your post is well intended but I believe is completely off the mark.

In fact for demand to be appropiately controlled at this time oil prices should be at about $182.00-barrel and gas at $7.00 per U.S. gallon.

What I am talking about is the phenomenon known as global "Peak Oil".

This is a very informative article and is contrary to what Canadian oil commodity experts who must be really kidding themselves if they think oil prices have peaked and our oil supply is plentiful.

http://www.lifeaftertheoilcrash.net/

That phenomena has been recited, in varying versions, since the early 1920's. It hasn't happened yet and I doubt it ever will. Oil has historically fluctuated between "real", i.e. current dollar prices of $97 (back in 1980) and about $12 (1970-2, 1986, 1998-9). It may fluctuate closer to the $35 figure, on average, than the $20s in which it spent most of the late 1980's through early 2000's.

Higher, but not the end of the world.

Obviously you did not READ the article.

Prices is only part of it.

The important part is DEMAND caused by a massive increase in POPULATION.

The current bankink system basically covering most aspects of society depends on 'CHEAP OIL'.

Oil simply will not be there at ANY PRICE.

Socities crumble when the SUPPLY for fossil fuels CEASES.

TO DATE THERE IS NO VIABLE ALTRNATIVE to oil and gas that will appropiatey and resonably supply the masses.

[Jerry J. Fortin]

Sure there is! Hydrogen will fill the gap for fuel until fusion is established. For lubrication we have synthetics. In the mean time we can work on solar and wind power in our homes. Tidal power will work on the coast lines very well thankyou. Oil is just plentiful and cheap for the moment so that is what we use. Mankind will adapt or die. That is an evolutionary fact. But you can run around saying the sky is falling if you like, we can all use the entertainment.

[jbg]

Obviously you did not READ the article.

Prices is only part of it.

The important part is DEMAND caused by a massive increase in POPULATION.

The current bankink system basically covering most aspects of society depends on 'CHEAP OIL'.

Oil simply will not be there at ANY PRICE.

Socities crumble when the SUPPLY for fossil fuels CEASES.

TO DATE THERE IS NO VIABLE ALTRNATIVE to oil and gas that will appropiatey and resonably supply the masses.

I just did. Again, these types of articles/forecasts have come recurring starting in the early 1920's. They were very common from 1974 to the early 1980's, and appear to coincide with relatively high real oil price periods.

In this case, oil shale and tar sands will come to the rescue. Also, another encouraging indicator is the lead article in today's New York Times Sunday Magazine (link), which points out that nuclear power may start "backing out" some fossil fuel use.

In short, I believe that most of the people sounding the alarm are addicted to central planning, to creating problems that the government must then solve. Peak Oil is Exhibit "B"; Kyoto is Exhibit "A".

[Jerry J. Fortin]

You know something people, you are going to have to start thinking for yourself sooner rather than later. The damned government is not the source of inteligence and life saving ability YOU ARE!

This is getting to be a very sad commentary on the hearts and minds of Canadians, we have become depedent on the state and that is just stupid.

[BubberMiley]

This is getting to be a very sad commentary on the hearts and minds of Canadians, we have become depedent on the state and that is just stupid.

Sometimes the state can provide solutions the private sector can't because some things require so much capital investment, market competition would make it prohibitively risky and/or inefficient. See electricity grid, highways, the telephone system, the provision of clean water, NASA, and, yes, education, health care, social security, and of course the CBC.

[August1991]

First of all, as a result of Iran's decision in the last four years to try control the world oil market's prices, it deliberately convinced the greedy Europeans to turn on the Americans and change the world trading currency for petrol from American dollars to Europ dollars.

This is irrelevant. The choice of currency to denominate a transaction is a mere convenience. If an international airport chooses to post prices in euros instead of British pounds what difference does it make if everyone pays in US dollars anyway? In fact, the comparison is apt. Most people pay with a credit card so in fact the whole payment process is entirely private and does not concern "US dollars" at all. That is the case of the world oil market.

If anything, India's and China's dramatic increasing demands for fuel is the real cause of unstable oil prices and even that is not the full reason for what we are seeing right now.

IMV, China and India are the main driving forces in world oil markets now, along with the absence of Iraqi production.

Obviously you did not READ the article.

Prices is only part of it.

The important part is DEMAND caused by a massive increase in POPULATION.

The current bankink system basically covering most aspects of society depends on 'CHEAP OIL'.

Oil simply will not be there at ANY PRICE.

Socities crumble when the SUPPLY for fossil fuels CEASES.

TO DATE THERE IS NO VIABLE ALTRNATIVE to oil and gas that will appropiatey and resonably supply the masses.

[Leafless, would you please not press on reply and copy all the previous posts?]

People who believe in "peak oil" have a profound misunderstanding of markets and how they work. We will never run out of oil. If it ever happened that our reserves began to fall, the price of oil would continue to rise, and rise. Anyone that owned oil would want to keep some for sale tomorrow or next year when the price rises further.

In fact, there is a theory that the price of oil should rise on average by the interest rate - oil is like money in the bank and it should offer a competitive return similar to any other investment. (In fact, the theory must only apply in the long run since the current price of oil (adjusted for inflation) is about what it was in 1980.)

The evidence is that as the price of oil rises, exploration becomes feasible, new deposits become profitable and old deposits are worth a second look. And we discover new ways to use less oil. We are less dependent on oil now than in the early 1970s.

I worry about the environment; I worry about giving gazillions of dollars to Middle Eastern radical states in exchange for oil; I don't worry about running out of oil.

-----

Setting prices didn't work for the Soviet Union, so I fail to see how it will work for New Brunswick either. You and everyone else with half a brain is right...this is just going to spiral out of control.

How long will it take people to abolish minimum wages?

Okay I will bite, how does that pretain to gas price?

A minimum wage makes it illegal to sell labour services below a certain price (wage).

A maximum gasoline price makes it illegal to sell gasoline above a set price.

In both cases, the price can't adjust on its own and so invariably, some people who would like to buy or sell can't. In the case of minimum wage, some people are left without jobs and in the case of gasoline, some gas stations shut down.