By Courtney Markewich

Low crude price won’t bring pump relief in Sask.

Oct 1, 2014 | 5:08 PM

A low price for crude oil won’t mean a low price for people fueling up their vehicles in Saskatchewan.

On Wednesday, some pessimistic reports emerged as oil prices hit a two-year low, with WPI dropping 13 per cent over the quarter and Brent losing 17 per cent.

Enrpo gas price analyst Roger McKnight explained that while pump prices usually reflect crude prices, that likely won’t happen this time.

“The next two months are going to be a bit strange because I think your prices are not going to drop as much as crude oil,” McKnight said.

“We have a situation with gas supply in the United States which is getting tighter and tighter is going to be reflected right across the United States, Western Canada as well as Eastern Canada.”

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A large part of the situation in the U.S. has been caused by unplanned shutdowns of a number of refineries. Severe refinery problems have hit the U.S. Gulf Coast, which McKnight explained is driving up the future price of gasoline, and two major Canadian refineries had unexpected stoppages.

“The crude supply in North America is wonderful. As a matter of fact, they don’t know what to do with it and Americans are trying to figure out whether to export it or not. So it’s not a question of crude supply, it’s not a question of crude price. It’s a question of refinery capacity which has gone off the wire.”

McKnight pointed out that the falling Canadian dollar will result in higher gas prices as well.

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