September 25, 2003
(Government Services and Lands)
The following is being distributed at the request of the Petroleum Products Pricing Commission:
Early adjustment made for gasoline prices
For the second time in as many weeks, the maximum price for gasoline in Newfoundland and Labrador has dropped.
Gasoline prices on the world market have seen an overall decline during the past week, and this movement has created enough of a change for the Petroleum Products Pricing Commission (PPPC) to make an early adjustment in prices through its interruption formula.
Effective 12:01 a.m. Thursday, September 25, the maximum price for all types of gasoline will decrease by 4.0 cents per litre (cpl).
There will be no change in distillate fuels (home heating and diesel) or residential propane used for home heating purposes at this time. While there have been declines in distillate fuel prices, they weren�t enough to activate the interruption formula.
However, George Saunders, PPPC commissioner, doesn�t rule out the possibility that an early adjustment for distillate fuels may happen. The PPPC research staff continues to closely monitor figures, and the office is prepared to move prices if necessary.
He noted that this interruption marks the third time since the formula was introduced March 14 that the commission has used it to decrease gasoline prices, and it has only been used once (August 28) to increase prices.
"Because of our interruption formula, which was designed to handle sharp and sustained increases or decreases in fuel prices on the world market, consumers will not have to wait until October 15 in order to see the impact such a decline in gasoline prices is currently having across North America," said the commissioner. "It remains to be seen if an interruption will occur in the other fuels we regulate in the province. We will do it if necessary."
One reason for the decrease in gasoline prices on the world scene is the comfort level relayed by analysts that there is a sufficient supply. There are currently record levels of imports to the United States � the world�s largest energy market - and the demand for this fuel is easing.
Also working to lower gasoline prices during this period was the fact that Hurricane Isabel didn�t impact fuel deliveries to the US or refinery production, and this created a sense of relief when it comes to supply and inventories. According to the US Energy Department, supplies of crude oil, gasoline and heating oil soared in the US last week as gasoline demand fell.
Mr. Saunders cautioned that it is unknown how long this trend will last, and the PPPC will continue to monitor the markets and make adjustments when necessary.
Media contact: Michelle Hicks, Communications. Tel: 1-866-489-8800. Cell: (709) 486-4789.
2003 09 25 8:45 a.m.