VANCOUVER (NEWS 1130) — As your pocketbook takes a hit from soaring gas prices, one analyst says it proves just how reliant we are on all types of pipelines in B.C.
After the gas pipeline rupture in Prince George earlier this week, gasoline prices hit almost record levels. One reason for it is that refineries use natural gas to undertake their refining process, so tight supply means cuts to their output, which in turn raises prices at the pump.
Dan McTeague, senior petroleum analyst with gas price tracker GasBuddy, says the issue is Washington state refineries had to cut back on production and that created a shortage in gasoline that in some places south of the border resulted in a 30-cent per gallon increase last Tuesday. Refineries must find alternatives to power their run operations in the short-term.
“That’s created a bit of a temporary bump in gasoline at the spot market, which is the market that everyone is governed by in the Pacific Northwest, and the market, by the way is located, in Portland, Oregon,” McTeague tells NEWS 1130. “That is now, of course, part of the reason why we’ve seen a 4-cent overnight jump here in Vancouver and why pretty much the entire Lower Mainland, [and] Vancouver Island has been affected.”
He expects prices to remain high until the time the gas pipeline is fixed and flow has been restored, with today’s $1.639 hitting an all-time record. He adds the Pacific Northwest’s “chronic” low-output high-demand causes these dramatic price fluctuations and as fast prices have been rising, they will also drop.
“Once we have the all-clear and the lines are repressurized, I think it will be back to a $1.52 likely within a short period of time,” he says. “For now, we’re not at that point yet. Unfortunately for us, we do rely on pipelines evermore, not just here in Vancouver, but right across North America.”
In a Saturday press release, Enbridge Inc., which runs the gas pipeline in Prince George, said crews will be able to slowly move in and clean up the ruptured pipe, but gave no definite date when gas can start flowing at normal levels.
— with files from Mike Lloyd