Mr. Speaker, I rose in the chamber to ask a question of the government related to a study by the Canadian Centre for Policy Alternatives on gas pricing, entitled “What’s behind high gas prices?” The study proves that Canada's oil and gas industry has reported record profits of over $16 billion in the last year alone, according to Nickel's Energy Group.
Michael Ervin, a leading industry insider and consultant himself, described the industry's recent profit margins as spectacular. This would not be so bad if it were not at the expense of Canadian consumers or if it were down to simple market forces as had been advocated by the industry. However it is not. There is clear evidence of price gouging by Canada's oil and gas industry, particularly during the period of the recent U.S. hurricanes.
The price of crude oil rose by $10 U.S. per barrel between June and September. If the industry had kept its other expenses constant, that should have led to an increase at the pump of just 7.9¢ per litre. Instead the average increase was 15¢, with some communities paying significantly more. Over Labour Day weekend the average increase was 40¢ on the June price alone. According to a report from the CCPA, the price of Canadian gas should never have gone above $1.
The gas industry was engaged in clear gouging, taking advantage of public fears over hurricanes Katrina and Rita. For every penny per litre the price of gas rises, the industry takes an additional $1.1 million per day. This means at the point of peak gouging, when the difference between a justified crude oil increase and pump price was as much as 45¢, the industry was raking in $50 million of excess profits every day.
This has happened at the same time as the government is providing $1.4 billion in contributions, grants and subsidies to the oil and gas industry and is also providing the industry with a corporate tax cut.
That has to end. Canadians deserve accountability and they want the government to account for that. It was clearly price gouging at the pumps at a time when people lost their homes. There is destruction across North America and it is not acceptable to have excessive profits at the expense of other people and industries which has cost this country in terms of economic development, stability for families and, more important, accountability on which the government has to deliver.