VANCOUVER, B.C. – The British Columbia Utilities Commission (BCUC) released preliminary findings from its fuel data exploration project, and they found that retailers were not taking advantage of market volatility.
Fuel Data Exploration Project #4 monitored pricing behaviours to examine whether fuel retailers were “price gouging” when the Russian-Ukrainian conflict influenced market conditions.
For this project, BCUC selected a sample of retail gas stations across the province, and they were required to submit their fuel volume sales and fuel margins for February and March 2021 and February and March 2022.
Retail fuel prices increased in late February 2022, and the BCUC’s preliminary findings showed that retailers were not taking advantage of the market to set higher prices and earn higher margins than expected under normal conditions.
A release from the BCUC says that it costs fuel retailers more to purchase from wholesalers, so those higher costs offset the increased revenues for retailers.
The results also reportedly showed that retail margins increased between 2021 and 2022.
Likely due to the travel restrictions, 2021 was a lower than average year for volumes of fuel sold.
Earlier this month, Energeticcity.ca spoke to a concerned resident, Kevin Barredo, of Northern B.C., who had been tracking wholesale fuel prices in the region since the initial spike caused by Russia’s invasion of Ukraine. Barredo had received all his information from the BCUC’s website.
Barredo claimed that data earlier this month showed that gas stations in Fort St. John and Prince George kept their fuel prices at $2.14 and $2.16 per litre, respectively, when wholesale prices were at $1.64 per litre.
After reviewing data supplied by Barredo, communications manager for the BCUC, Krissy Van Loon offered insight as to why there was such a significant difference between fuel costs in Northern B.C. and Vancouver.
“Based on our initial observations, retail fuel prices in the north are generally more stable than retail prices in Vancouver, as Vancouver operates on a daily market, resulting in daily retail price fluctuations,” Van Loon stated.
She said the commission expects other areas of the province to gradually change retail prices and follow the general trends, such as changes in crude oil and wholesale prices demonstrated in the Vancouver market.
Van Loon said that while the BCUC doesn’t gather real-time data from the industry, the commission hopes to better understand any anomalies that are currently happening in the future once they’ve had the opportunity to gather and analyze data from the fuel industry.
The commission said it continues monitoring retail and wholesale price margins to ensure fuel companies in B.C. are not taking advantage of current market conditions and unfairly increasing the price of fuel for consumers.
“The BCUC will be selecting a sample of retail stations from all regions across the province that will be required to submit monthly statements for their fuel sales and margins for February and March 2021 and February and March 2022,” the commission said in a press release earlier this year.
If anomalies are found, the commission said it would request further information from the industry to provide clarity.
The BCUC says it will publish more detailed results of its analysis in upcoming newsletters available on the GasPricesBC website.
This project focused on the retail portion of the market, and the next stage will reportedly examine the wholesale market’s effect on fuel prices in BC with Exploration Project #3.
More information on these data exploration projects can be found here.
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