‘Reality is starting to catch up to markets,’ gas analyst says

Saskatchewan has seen a recent reprieve from the extremely high gas prices of mid-June, but Saskatoon is still better off than Regina and much of the western part of the country.

Dan McTeague, a gas price analyst and president of Canadians for Affordable Energy, said retailers whose prices were as high as $1.93 just over a month ago have now dropped their prices down to the $1.68 to $1.76 range in Saskatoon.

McTeague said that is reflective of what’s happening across the province, but the 28-to-30 cent drop in price here doesn’t quite match other markets like Chicago, which saw a 40-cent drop in price since the middle of June.

“I think reality is starting to catch up to markets,” McTeague told CKOM/CJME’s John Gormley.

According to McTeague’s estimates, retailers are paying around $1.53/L for gas, meaning they have a $0.14 to $0.15 profit margin on each litre sold. That margin is closer to 35 cents per litre in Alberta, which McTeague said was “unjustified.”

He said many stations don’t appear be heeding the usual warnings to avoid taking advantage of consumers when prices are high.

“The eclipsing of independent gas retailers has led to much higher retail margins,” he said.

That was the only explanation McTeague could provide for a situation that he said “defies explanation.”