As the barometer begins to drop with the oncoming winter, so does the price of gasoline in Saskatchewan. This can be exciting or a let-down, depending on how eager to risk the month of snowstorms and icy roads drivers are.
Jason Toews, co-founder of GasBuddy, a website that monitors gas prices across North America, said there are a number of factors at play that have put gas prices in such a low range. These factors include the time of year, the price of oil and the reality of competition between different gas stations.
“It really comes down to how aggressively gas stations are competing with each other. Right now we’re seeing most prices in Estevan around 95.9 (cents per litre). It could be lower, but it’s all based on competition between the stations,” said Toews. “The average price of gas in Saskatchewan is actually 91 cents per litre.”
Toews stated that when one gas station lowers its price, the others follow suit, trying to match that lower price and stay competitive. Where a gas station is located relative to an oil refinery, can also have an impact on how low the price of its gasoline is. This can be seen in the differences in prices in Regina and other municipalities.
“There are some trucking costs associated with getting gas. People will say, ’We produce a lot of crude oil near Estevan, so why isn’t gas cheaper?’ It has to get sent to a refinery first,” said Toews. “Gasoline for Estevan typically comes from Regina. Crude oil goes to Regina, gets refined and then gets trucked out to gas stations. That costs some money to do, of course.”
Toews advised that a person can easily plan cheaper trips by finding out where the best prices are in advance, and planning around
Another factor at play is the reluctance of motorists to drive in the winter as much as they do in the summer. Many people will put off longer trips because of the comparatively poorer weather in the winter, requiring gas stations to decrease their prices.
“Once we get out of the summer driving season, there’s less demand for gasoline, especially in Saskatchewan, where the weather starts taking a turn for the worst,” said Toews. “The weather gets colder, it snows a bit, the roads are icy and we generally don’t drive as much because of that.”
The low price of crude oil is also a deciding factor in how low gas prices are, since gasoline is a derivative product of oil. Prices hovering around $40 a barrel have a tremendous impact on the price of gasoline around the world, and Saskatchewan is no exception to that.
“They’ve been low, they were low this summer. Prices were around $1.20 per litre or something. These current crude oil prices are the reason we weren’t paying $1.50 per litre in the summer and aren’t paying $1.20 per litre right now,” said Toews. “If we had $150 per barrel oil, we’d be seeing (prices of) $1.20, or even $1.40 per litre of gasoline right now.”