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Montreal gas prices surpass $2.15 to hit new record

Click to play video: 'Gas prices soar to $2.15 per litre in Montreal' Gas prices soar to $2.15 per litre in Montreal
Montrealers are feeling the pinch at the pump as gas prices jumped again, surpassing $2.15 per litre. Global's Brayden Jagger Haines reports – May 16, 2022

Gas prices in the greater Montreal area soared to a new high over the weekend.

A number of gas stations were selling regular fuel at a price of $2.15 a litre on Sunday morning, which amounts to an 80-cent increase compared with last year.

READ MORE: Soaring gas prices stalling summer road trips for Canadians: survey

The Parti Québécois proposes temporarily limiting the cost at the pump at $1.60 per litre with the difference in price paid by oil producers.

However, this measure would be difficult to apply economically and would only support Quebecers’ dependence on oil, according to one expert.

Faced with the rise in the price of gasoline, which recently crossed the $2 per litre mark, PQ Leader Paul St-Pierre Plamondon protests to see the oil companies reaping record profits, calling it “robbery.”

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“It is neither normal nor acceptable that 85 per cent of the increase in the price at the pump goes directly into the pockets of oil companies and their refineries,” Plamondon said.

“There comes a time when you just can’t sit idly by. It takes a contingency plan,” he said in a statement on Sunday.

By bringing the price down to $1.60, the oil companies would find profit margins similar to the context of two years ago, said St-Pierre Plamondon in a telephone interview.

“And it was already gargantuan profit margins,” he told The Canadian Press.

The PQ leader mentioned that this measure could apply at least for six months or a year in order to relieve the finances of several families in the short term.

At the same time, the Régie de l’énergie would have the mandate to carry out an analysis to establish in the medium and long term what the reasonable price would be based on the circumstances.

READ MORE: Weekend gas prices on the rise across Canada as experts urge motorists to reduce travel

According to St-Pierre Plamondon, Quebec could draw inspiration from French law, which gives the possibility in a crisis situation of setting a ceiling by decree for six months, when it is shown that excessive profits have been recorded.

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Pierre-Olivier Pineau, a professor at HEC and holder of the Chair in Management of the Energy Sector, considers the PQ proposal an “extremely populist argument” that would be neither good economic nor environmental policy.

According to him, gasoline distributors would have difficulty selling at such a price since they must themselves obtain the petroleum product from refineries which may also have difficulty in reducing their costs.

“If we wanted to force the refineries to sell at that price, they would not be able to obtain sufficiently low oil supplies (from producers) to be able to refine oil in Quebec.

We would therefore face shortages of gasoline by wanting to maintain a lower price,” Pineau said.

But in his eyes, the PQ proposal will mainly have the effect, long term, of maintaining consumer dependence on oil,” Pineau said. “By paying less, they would be encouraged to keep their bad habits of consuming petroleum products for longer.”

Pineau recommends instead overtaxing the exceptional profit margins of the oil companies, following the example of countries like Norway, and investing in public transport.

The PQ reiterated on Sunday the urgency of getting Quebec out of oil dependence, but accuses the Legault government of “sleeping on gas.”

“The vast majority of Quebecers are only asking for that, but there are no electric vehicles for sale. There is a two-year wait, and that is due to the government’s lack of ambition, which sets currently at only 9.5 per cent the proportion of zero-emission vehicles (ZEV) that must be sold in Quebec,” St-Pierre Plamondon said.

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The PQ wants an increase in quotas to force manufacturers to increase the supply of ZEVs.

He mentions that countries like France, Germany and Sweden have sales quotas ranging from 25 per cent to 60 per cent.

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