I wonder when British Columbians will realize their politicians are lying to them and that it is causing them real harm?
Last week, B.C. Premier John Horgan said – presumably with no sense of irony – that the federal government should do something about high gasoline prices in the Lower Mainland.
If you had to re-read that line, you aren’t the only one.
How in the world can you block the expansion of a pipeline that would bring your residents gasoline, then complain that gasoline prices are too high?
One explanation is that the premier of B.C. doesn’t understand how the economics of supply and demand work. If you have greater demand than supply, prices go up. If you have greater supply than demand, prices go down.
While Alberta may be landlocked, the Lower Mainland is ocean-and-mountain-locked. They don’t have a lot of ways to get gasoline to their residents. It can be transported by truck, by train, by barge and yes, by pipeline – which just so happens to be the most cost effective and safest way to transport the fuel that we have.
What is even more stunning than Horgan’s apparent lack of understanding about economics is that he doesn’t even seem to understand the scope of the pipeline project he is trying to stop.
After being ridiculed for saying the federal government should “take some leadership” to reduce gas prices, he declared: “and the Kinder Morgan proposal, as it currently is constructed, will not bring down… gas prices. It will send diluted bitumen to another jurisdiction.”
There is no other way to say it – that is just false.
LISTEN: Dan McTeague with GasBuddy.com discusses those high gas prices in B.C.
Dan McTeague, a senior petroleum analyst with GasBuddy, questions whether Horgan has even read the Kinder Morgan proposal, as the Trans Mountain pipeline is unique in its ability to transport bitumen, light crude, diesel and gasoline.
It can meet Vancouver’s need for diesel and gasoline and the Burnaby Parkland refinery’s need for crude to refine into diesel and gasoline for Vancouver. It can also meet Washington State’s need for heavy crude in its refineries to turn into diesel, aviation fuel and bunker fuel for Vancouver.
Are you getting the gist here? All roads lead to Vancouver.
I also asked McTeague why Washington State’s Governor Jay Inslee would be opposed to the Trans Mountain Pipeline. Here’s the most likely reason: because of the lack of competing customers and the discount on Western Canada Select, refineries in his state are able to buy crude for a discount, massively mark it up in U.S. dollars and sell it back to Vancouver at a premium.
Who wouldn’t want to keep that sweet deal rolling? An increase in supply just might attract more buyers and all of a sudden those Washington refineries might lose their unfair advantage.
McTeague said B.C. consumers should expect gas prices to spike above $1.60 per litre soon and that they won’t decline again until September.
It seems to me that Vancouverites are being played by their politicians for no other reason than to allow Horgan to maintain his coalition with the Green Party and stay in power. It’s the worst kind of cynical politics. It puts political ambition above the interests of the people. More people need to call Horgan out on it.
Danielle Smith can be reached at firstname.lastname@example.org.