Watch above: Are the current gas prices justified given the low price of crude oil? University of Saskatchewan professor Greg Poelzer says yes.
SASKATOON – Rising gas prices are acceptable, given current circumstances, says a University of Saskatchewan professor.
“We’ve got a British Petroleum refinery, just outside of Chicago. It had to be shut down for repairs, and that’s where we get most of our refined gasoline,” Greg Peolzer, a professor of public policy at the university, told Global News.
“When its production got cut in half, unfortunately, our gas prices went up.”
According to Peolzer, two factors affecting our current gas prices include the cost of transporting it from other places, as well as the shortage of supply due to the plant being down. He said the refinery also supplies local markets with gasoline.
The professor said the seeming lack of correlation between low oil prices and rising gas prices is due to the fact that oil is used for a variety of products, including gasoline, diesel, jet fuel and kerosene, to name a few.
The good news? Peolzer believes we should be seeing lower gas prices once the plant is up and running again. Those prices should be reflected within six months to a year’s time.
“The event that occurred most recently was an unexpected event, so touch wood it doesn’t happen in the near future,” Peolzer said.