EDITORIAL – The never-ending quest for answers about the price of gasoline

An editorial by Mel Rothenburger.

THE PRICE OF GAS has long been the bane of British Columbians. Whatever the price at the pump, it’s too high. It’s one of the things we love to complain about.

Coun. Bill Sarai, with the backing of City council, wants to know why gasoline costs more in Kamloops than other Interior communities. They’re higher here than in the Okanagan or Fraser Valley, he says. “Higher than anywhere in our Interior… I’d just like to know why.”

Mayor Reid Hamer-Jackson said he thinks they “aren’t that bad” and actually are often higher in the Okanagan.

But Coun. Stephen Karpuk agreed with Sarai. On a recent trip to the Okanagan, he said, the price at the pump was up to six cents cheaper than here. What are the criteria for setting prices, he wanted to know.

So, letters are being sent off the our MLAs, MP, and government ministers asking for answers.

Good luck with that. The same question, about why gas prices are as they are, has been asked since time began or, at least, since the invention of the internal combustion engine.

Every once in a while, it comes up in the B.C. Legislature, with whoever is in Opposition blaming whoever is in government and demanding action. A 114-page B.C. Utilities Commission report on the matter concluded in 2019 that there really was no answer.

In 2022 we got gas rebate cheques to try to calm us down.

Experts, and there are many, conclude there are lots of reasons for the wild fluctuation in gasoline prices, including such things as supply (demand never goes down), political instability, refinery maintenance, price wars, and wars in general.

But why is it so often cheaper to buy gas in Falkland or Vernon than it is in Kamloops, from where the gas is shipped? That’s always baffled us here in the Tournament Capital. So, I did the obvious thing and asked Mr. A.I. Here’s his answer:

“Gasoline is often cheaper in smaller communities like Falkland compared to Kamloops due to a combination of localized competition, market demand, and, in some cases, lower operational costs or, if applicable, tax differences on First Nations land.

“While Kamloops is a major transportation hub, its high-traffic, high-demand nature often allows retailers to maintain higher margins.”

He goes on to say, “Kamloops is a major junction for two main highways. Retailers often capitalize on high demand by keeping prices higher, a practice residents frequently refer to as ‘gouging’.”

And: “In smaller communities, stations might operate with lower overhead or, conversely, set lower prices to compete with nearby cities, whereas high-volume, high-traffic areas like Kamloops often see higher, more uniform, and slower-to-drop pricing.”

That’s called, what the market will bear. “Although most fuel in the interior comes from the same terminal, local station owners set their prices based on their own profit goals, not just the cost of fuel.”

But a recent social media discussion in Vernon claimed that, on that particular day, gas was 20 cents higher there. And, take heart in the fact that the price of gas in Kamloops, since the carbon tax was removed, is roughly the same as it was a dozen years ago.

It’s highly doubtful that sending off letters to Victoria will get better answers.

Mel Rothenburger is a former regular contributor to CFJC-TV and CBC radio, publishes the ArmchairMayor.ca opinion website, and is a recipient of the Jack Webster Foundation Lifetime Achievement Award, and a Webster Foundation Commentator of the Year finalist. He has served as mayor of Kamloops, school board chair and TNRD director, and is a retired daily newspaper editor.  He can be reached at mrothenburger@armchairmayor.ca.