Petroleum analyst explains what's fueling Windsor's fluctuating gas prices
CBC News | Posted: March 28, 2018 6:14 PM | Last Updated: March 28, 2018
'Big box stores will continue to sell at a loss, but the rest simply can't afford to do that'
It's wise to shop around if you need to put gas in your tank this week in Windsor-Essex.
Most stations in Windsor are still selling at more than $1.30 per litre, after a major price increase Tuesday. However, a few outlets have put their prices back down.
Dan McTeague is a senior petroleum analyst with GasBuddy.com — a website which uses consumer reports to look at regional prices.
He said prices needed to go up because everyone had been selling gas at or below the wholesale price.
"You can't operate a gas station buying your fuel at the same price you're selling it for," he said. "You still need a margin to survive on, so that's why a lot of them have had to come up for air."
Hear more from McTeague on CBC's Windsor Morning:
Right now, it costs a gas retailer just over $1.18 per litre at wholesale cost, according to McTeague, adding that even gas stations that still have lower prices will eventually have to raise them along with everyone else.
"Everyone's throwing in the towel," he said.
McTeague said big box stores like Costco will probably continue to sell at a loss, but "the rest simply can't afford to do that."
Prices could go even higher in the coming weeks, as it's that time of the year when we switch to "summer gasoline" which contains "expensive" additives that keep gas from evaporating.
"So that's where the cost to refineries is passed on to consumers," he said. "Usually about four cents."