A week after fuel costs soared and sparked allegations of price gouging, motorists were given a break Friday morning as prices eased across the country.
In Montreal, prices were down from Thursday's average of around $1.34 to $1.31 a litre, and in Toronto, the cost dipped about five cents overnight to $1.15 a litre, according to the price tracking website gasbuddy.com
The cheapest gas in Canada early Friday morning was in Ontario, where the average price was a little more than $1.23 a litre. The priciest province was Newfoundland at about $1.39 a litre.
Last week, prices spiked by nearly 13 cents a litre, which led to accusations from Conservative Leader Stephen Harper and other politicians that oil companies were gouging customers.
Since then, prices have slowly normalized in most cities.
In July, the price for a barrel of crude oil reached an all-time high of US$147.27. On Thursday, the price on the New York Mercantile Exchange had eased to US$96.
But according to Michael Ervin, president of Calgary-based energy consulting firm MJ Ervin and Associates, the price of crude oil doesn't necessarily reflect the price at the pumps.
"The crude price going up is only one factor that's (changing) prices," he told CTV.ca.
While Hurricane Ike has been blamed for the massive price spike last week, Ervin said the rise had more to do with a slowdown in gasoline production during the summer months.
Ervin noted that during the spring months, refiners upped their gasoline production in anticipation of the usual demand increase from drivers over the summer months.
But thanks to a slowdown in the U.S. economy, Ervin said there was an "excess of inventory" heading into June and July, meaning producers scaled back production.
"Ike was simply the tail end of a long-standing decline in gasoline supplies," he said, adding production has been stepped up again, resulting in the current price drop at the pumps.
"Refiners have regained their interest in making gasoline."
