NLIS 3 March 6, 2006 (Government Services) The following is being distributed at the request of the Public Utilities Board�s Petroleum Pricing Office (PPO): Some maximum regulated fuel prices set for slight increases Effective 12:01 a.m. Monday, March 6, 2006, the Public Utilities Board, through its Petroleum Pricing Office, used the interruption formula to increase the maximum prices of several fuel products in Newfoundland and Labrador (NL), except in areas where a price freeze is in effect. The maximum price for all types of gasoline rose by 3.4/3.5 cents per litre (cpl) � depending on the HST rounding effect in each pricing zone. Also increased are No. 2 blend furnace oil by 2.78 cpl and stove oil by 3.18 cpl. The interruption formula criteria (see Backgrounder) were not met for automotive diesel or residential propane used for home heating purposes, and there will be no changes to their maximum prices at this time. Refined fuel products continued to demonstrate unpredictable behaviour on NYMEX (the New York Mercantile Exchange), as the commodity markets reacted differently, often on a daily basis, to contradictory forces occurring in the global marketplace. When specifically looking at gasoline, increased demand in the U.S. (the world�s largest consumer of fuel), during a time when many refineries are shutting for maintenance, has sparked concerns about the availability of future supply as the traditional peak driving season approaches. As for the distillate fuels (furnace/stove oil and automotive diesel), inventories are in a relatively healthy position; however, reports reflected a decline in stockpiles during this past week because previously lower demand levels have started to increase resulting in market price hikes. Other factors that have affected refined fuel prices include: BACKGROUNDER Regulated fuel prices are adjusted on the 15th of each month using the average daily prices for most finished petroleum products as listed on NYMEX (New York Mercantile Exchange). In the event of volatile behaviour between normal price adjustments, the interruption formula is used by the board based on specific criteria to make upward or downward interim price changes as warranted in the marketplace. For the interruption formula to be used on gasoline, diesel or furnace/stove oil, price fluctuations on NYMEX must exceed an average of � 3.5 cpl over a five market business-day period. Adjustments are then made where price increases or decreases are warranted. In the case of residential propane, figures are derived from pricing activity at the Sarnia rack, and the interruption formula criteria for this fuel differ from the other regulated petroleum products. Bloomberg�s Oil Buyer�s Guide weekly figures must exceed a � 5.0 cpl change from the previously established base price under regulation. 1. Automobile Fuels � Maximum Retail
Pump Prices � Effective March 6, 2006 Media contact: Michelle Hicks, Communications, 1-866-489-8800, (709) 489-8837 2006 03 06 10:20 a.m. |
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