Wednesday, 25 May 2011

Thoughts about gas

Everybody who drives a car has probably thought about this recently, or heard somebody say this recently. Gas prices are freaking ridiculous!

Excuse me, but is this a joke?




That picture was taken about two weeks ago in Toronto, Canada. For the American readers who might not understand, that's $1.41 per LITRE (1 L = 0.264172052 US gallons). Now granted this was about two weeks ago, and the price per litre did quite a bit as of today's date (which is extremely odd because prices normally don't drop that much, but we'll get into that later). According to Tomorrow's Gas Price Today, tomorrow, May the 26th, gas is expected to cost around $1.30, while a barrel of crude oil will come in at about $98.30. Now generally, up until about two years ago, you could easily predict the price of gas on your own by dividing the price of a barrel by 100. Using this method, gas prices should be hovering around $0.98 per litre? So why the huge mark up?

Well 8% of the mark up is due to the sleezy tax grab in Ontario known as HST. For those who don't know before the summer of 2010, there were two sales taxes in Ontario, PST (Provincial Sales Tax) and GST (Goods and Services Tax, or the federal sales tax). During the summer of 2010, a new controversial sales tax was introduced, which would merge both the GST and PST, into one tax, the HST. So what right? You had to pay both taxes either way right? Wrong.

Many things used to be exempt from either the PST (gasoline for example) or the GST (no example comes to mind, haha). After the HST was implemented, the 8% PST was to be merged with the 5% GST, creating a universal 13% tax on all purchasable items, thus increasing the price of certain necessary commodities, for no reason, except to gain more profits...

Back to the main point at hand, gas is a consumable, and non renewable commodity. As people use more and more of it, there's less and less to go around. Which in turn drives up the prices to what we see today. Does anybody remember when you could buy a litre of gas for 40 cents? I do... Anybody remember when people were complaining about gas being 80 cents? I do... And I'll probably re-read this post some time next year, and laugh at how I was complaining about paying $1.30 at the pumps for a litre...

But why are the prices so high? Surely we're not facing a gas drought?! I know a lot of European readers would probably be laughing to themselves, while shaking their heads. Yes, it is true, gas prices in Europe are MUCH higher than in North America. But there's one key difference between a random European country and Canada. Canada has it's own oil. Canada refines its own oil. Others will blame the high prices on the insanity happening in the Middle East right now. Once again, Canada shouldn't be affected by this. But it is...

And I'll tell you why:

Canada is notorious for harbouring monopolies, and  having a sever lack of regulation. Canadian's pay exorbitant fees on almost EVERYTHING, be it cellphone bills, internet bills, TV bills, phone bills, alcohol, and yes, gasoline.  There is virtually no competition on any major front in Canada, especially in the domain of Oil Refineries. Lack of competition, coupled with the lack of government regulation and interference, allows the corporations to set any price they like, just because they can. What's stopping the refinery from charging Canadian's $1.40 per litre? Nothing at all. If you want to drive, you need gas. That's the bottom line.

How do you feel about this?

29 comments:

  1. I feel fucking mad about this. Then again, corrupt shit like this is happening in the United States as well. Nobody is safe from corrupted sons of bitches.

    Thanks for the informative read.

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  2. god canada is so broken, but i love it nonetheless/. next talk about the pot laws :P

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  3. Just filled my tank, not very fun :(

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  4. haha I'm from toronto as well.
    yep, gas sucks.

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  5. Gas is hella expensive, everyone at school is complaining. Wish I could afford a car to begin with.

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  6. Damn monopolies, making everything expensive

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  7. ya i cant believe how much it costs nowadays

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  8. so ridiculous how muc it costs, i bet itl get past 5 bucks a gallon by years end

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  9. Man, so glad i take public transport.

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  10. The price of oil is rising and will get a lot worse in the future. I'm sometimes glad I don't drive but still a vehicle is essential to really get anywhere in life.

    Also thanks for the follow and comment.

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  11. Thats rough man, I'm in New York on Long Island myself and they love ramming high gas prices and taxes up our assess too

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  12. gas prices keep going up and down so much it is ridiculous

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  13. I want to take a piss in an oil field.

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  14. Gasoline is probably one of the most expensive liquids. I bet water (bottled water) is still even higher, however.

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  15. alternative energy now, so we don't have to take shit from dogdgy oil dictators

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  16. Well you haven't seen the prices in Germany... :/

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  17. I want to know why the price of petrol hasn't changed that much over the last few months when the american dollar is ion the toilet. It doesn't make sense.

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  18. This is the exact reason I just bought a motorcycle ha ha.

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  19. Gas is getting pretty expensive in Norway too, and we also refine and get a lot of our own oil. Oil was a huge part of what made us an industrial country! We have tons of rules against monopolies, but gas prices are still rising a lot. Even when they found that huge bulk of oil and the barrel price dropped a lot, we had the same expensive gas. I think it's just because everyone's realizing oil is not an infinity source of energy, and we are going to run out some time, so they want to squeeze the most out of it. Like how you start enjoying your snacks more when there's less left.
    You might be absolutely right though, I'm certainly no economist

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  20. guess im going green this summer via carpool, bus, ect. cool story bro!

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  21. Dont think it is just Canada...
    In the USA 50 cents of every gallon of gas goes to the government..
    while the gas companies profit between 2 and 3 cents per gallon...

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  22. I was in Orlando a few weeks back, gas was 5.58, and of course it's packed with people filling. I dont get how these companies can get away with this.

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  23. I hate how expensive gas is.

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  24. When gas prices go up, I go "awesome." Maybe people will start taking electric cars seriously or maybe hybrids. Gas up, means investment in non-tard methods of transportation. Win.

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  25. we should invest in oil companies instead

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