I Have Bad Gas

No no, not that kind of gas. I mean the kind you use for your car. Most places let you choose the octane level. I use Shell, (Hey I collect Air Miles) and you can choose from 87, 89 or 91 octane. Now I have no idea what octane is, or why more of it is better, but I know I can barely afford the cheap stuff. I once asked the gas jockey, (Is that what you call them? or maybe 'pump boy' or 'hose dude' I dunno) "Yes can I get something in a 50 octane?" he looked at me like I look at Leafs fans and I assumed that meant no.

The truth is there is a lot that goes into the cost of fuel. I am no genius but I realize it's a finite resource that is getting harder to find. So as environmental or political situations change, the demand fluctuates and so does the price. Kinda like when the XBOX 360 came out and there weren't enough at Christmas so people were scalping them for twice the price.

The basis for gas prices is of course crude oil prices. These are measured per barrel and a barrel is 159 Litres in case you wondered. Is that more or less than two kegs? Just curious. Well the crude costs have been fairly low traditionally even back in 1973 if you adjust the prices to todays dollars it's only around $40 US per barrel. At the time though that was an increase of nearly 75% which wreaked havoc across the globe as transportation costs affected goods of all kinds. Since then the cost has stayed at or near the same level. The only real time costs were as high as they are today was during the hostage crisis in Iran in 1980 prices reached $80 US per barrel (adjusted).

It seems though that crude may hit $100 US per barrel in the not too distant future which means that my days of driving your SUV to the end of the driveway to pick up your mail may be over. I may even have to walk or bike now! Noooooooooooo!

Of course in the short term I would like to see the government back off the taxes. As you see in the chart above we pay a LOT of tax on fuel. In fact based on Oct 05 prices a 50 L fill would cost you $16 Cdn just in tax! It's not like it is just one tax either. Every province and territory pays a federal excise tax, a provincial tax, (not to be confused with PST), as well as the GST/HST. Yes a tax on a tax! Quebec also pays 7.5 cents PST and in some cities there is also a transit tax. Vancouver's transit tax is 6 cents per litre. Montreal residents pay 5 different taxes on fuel. Nationally averaged, we pay approx 35% tax on fuel whereas the US pays only 20%. The funny thing is we are actually doing pretty good in Canada. Look at the cost of fuel taxes internationally;

• Gas prices as of Oct 05 in Cdn dollars were very close around the world. the US, Canada, Japan, Spain, France, Germany and the U.K. were within 11 cents of eachother ranging from .68 to .79 per litre.
• The taxes were vastly different however, ranging from .62 in Spain to a whopping 1.27 in the U.K. meaning that the Brits pay more than 65% of their total fuel cost on taxes! that means the brits pay $63 in taxes on a 50 L fill! No wonder their buses are double deckers.

The Conservative government has pledged to offer some relief at the pump in the next budget so stay tuned for that announcement. If only we could harness the hot air from politicians, now that would be a renewable resource! I could go on and on (and frequently do) about collusion, (big word, kind of like wheelbarrow), or the effects on our economy but the bottom line is that this summer it will cost more than ever to drive or fly anywhere, and consumer goods are likely to be marked up as transportation costs rise.

So for the foreseeable future I like many others will have to settle for 87 octane and feel the effects of all that bad gas. Until next time remember, no Payne no gain.

Tomorrow we will have the latest from the UFC, and then it's the NHL playoffs!

Thanks to CBC and Petro-Canada for providing info for this article. Wow this is a very tiny font. I wonder if anyone will bother reading this.