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Canada's gas prices spike amid foreign unrest

Turmoil in the Middle East has caused the price of gasoline to soar even though Canada is a major producer of oil and has vast reserves.

Canada exports most of its oil to the United States, where it is refined and much is shipped back as gasoline, along with imported foreign oil at world prices.

This has caused gas prices to jump to more than $1.20 a liter (about $4.56 a U.S. gallon) from just above $1 in Ontario, British Columbia and Saskatchewan in the past week.

Prices have been relatively stable so far in other provinces, while the national average has jumped to about $1.14 a liter.

With large inventories of oil in North America, prices should be steady, said industry consultant Michael Ervin of Kent Marketing Services.

Higher prices benefit the Canadian oil industry, resource-rich Alberta and provincial governments collecting taxes on gasoline, and are also due to European countries now buying Canada's available oil, he said.

The benefits could come at the cost of a stalled economic recovery, especially in Ontario's auto industry, said oil analyst Peter Buchanan of the Canadian Imperial Bank of Commerce.

Conservatives find increasing support

Also rising is popular support for Prime Minister Stephen Harper's minority Conservative government.

A Nanos public opinion poll gives the Conservatives 39.7 percent support nationally, compared with the Liberals at 26 percent.

The poll results suggest the Conservatives' ad campaign attacking the Liberals and Liberal leader Michael Ignatieff led to the boost for Harper, pollster Nik Nanos said.

A question about leadership qualities showed Harper on top with 34.5 percent, while New Democratic leader Jack Layton was second with 14.3 percent.

News in brief

• Conservatives appear to be on the election trail as 70 Members of Parliament and Senators are crossing the country selling the government's Economic Action Plan. The costly efforts to recover from the economic downturn are working, the government says, noting that 460,000 new jobs have been created in less than two years. It's the strongest job growth in the Group of Seven, and Canada's economy has advanced the last five quarters, recovering all job losses.

• A judge will decide how many Bell Canada call center workers in Toronto will be splitting a $50 million, tax-free Lotto Max prize. Nineteen workers, who originally claimed the Dec. 31 jackpot, have been given checks for $1.6 million each while the remaining claim is considered. Up to 11 other workers who say they were left out of the ticket pool are suing for the disputed $18 million of the original amount.

Facts and figures

The Canadian dollar has advanced to $1.0183 U.S., while the U.S. dollar is lower at 98.20 cents Canadian, before bank exchange fees.

TD Canada Trust and CIBC are among the banks hiking their five-year closed mortgage rates to 5.44 percent, up one-quarter of a percent.

The key interest rate of the Bank of Canada remains at 1 percent, while the prime lending rate is 3 percent.

Stock markets are lower, with the Toronto exchange index at 13,867 points and the TSX Venture Exchange at 2,328 points.

Lotto 6-49: (Wednesday) 5, 6, 15, 24, 35 and 48; bonus 39. (Feb. 9) 10, 16, 20, 26, 34 and 48; bonus 40. Lotto Max: (Feb. 18) 3, 7, 12, 16, 20, 42 and 48; bonus 31.

Regional briefs

• Manitoba's agricultural industry will be in jeopardy should massive spring floods occur, as predicted. The Conference Board of Canada said flooding of the Red and Assiniboine river valleys poses a "downside risk to the Manitoba economic outlook." A significant flood, similar to that in 2009 with 215,000 acres of farmland washed away, has been forecast.

• Alberta residents will pay more in user fees as the Conservative government holds the line on spending, facing a $3.4 billion deficit. It's the fourth spending deficit in as many years but will be covered by the province's sustainability fund, now worth $11 billion. There will be fee increases for such things as motor vehicle registrations and licenses, campsite reservations and land title searches, but no tax increases.

• They snoozed and he could lose after a Quebec motorist took photos of two Quebec Provincial Police officers asleep in their cruiser east of Montreal. One of the officers awoke to find Maxime Carpentier taking their picture on a highway in Trois-Rivieres. He gave Carpentier a ticket for $154 for parking on the highway.

Jim Fox can be reached at canadareport@hotmail.com.

Canada's gas prices spike amid foreign unrest 02/26/11 [Last modified: Saturday, February 26, 2011 7:14pm]
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