CALGARY - Drivers in many parts of Canada were greeted with a welcome sight outside their local gas stations Thursday: posted pump prices several cents cheaper than what they had paid a few days earlier.

The national average price for a litre of regular was about $1.32, down almost four cents from Wednesday, according to gas watcher website GasBuddy.com.

The lowest prices across the country are to be found in Ontario, both Toronto and Hamilton hitting as low as $1.21 a litre.

In Alberta prices a bit higher, with Edmonton and Calgary both around $1.26.

Drivers in British Columbia, where a new carbon tax went into effect July 1, were still feeling the pinch, with Victoria at $1.36 and Vancouver at $1.40.

Last week the price of gasoline spiked by as much as 13 cents in some Canadian cities ahead of hurricane Ike's lashing of the U.S. Gulf Coast, home to about a fifth of that country's refining capacity.

The high prices continued into this week, hitting an average of $1.42 on Monday.

Toronto Liberal MP Dan McTeague, a vocal oil industry critic, said much of the increase in Canadian pump prices can be blamed squarely on wholesalers who charged way beyond the trading price for gasoline on the New York Mercantile Exchange.

He said they took advantage of hurricane fears and increased their margins more than was warranted by the fundamentals.

"I think there was tons of profit taking, there was no supply disruption whatsoever," said McTeague, a five-term MP who is seeking re-election in the Oct. 14 election in his southern Ontario riding just east of Toronto.

"What we saw last week was rather bald-faced attempt to make some money and try to stash the cash."

Earlier this summer, criminal charges were laid against 13 people and 11 small companies for fixing gasoline prices in Quebec. Three of the companies pleaded guilty and were fined a total of $2 million.

However, the oil industry says studies have consistently shown that the Canadian gasoline industry -- dominated by big integrated companies such as Esso station owner Imperial Oil (TSX:IMO), Shell Canada, Petro-Canada (TSX:PCA) and Suncor Energy (TSX:SU) -- is competitive and does not fix prices.

Meanwhile, the price of crude oil, the main ingredient in gasoline, continued to be volatile Thursday.

A barrel of crude oil for October delivery was worth about US$96 on the New York Mercantile Exchange on Thursday after dropping near US$90 earlier in the week.

In July, crude hit an all-time record of US$147.27.

The cost of crude oil is only one part of the final pump price, and analysts say its effects tend to be delayed. That's because the gasoline that was sold today was made from crude oil purchased months earlier.

A major factor is supply and demand. With the summer driving season coming to an end, motorists are guzzling fewer litres of fuel.

And U.S. refineries that had been shuttered as a result of hurricane Ike will likely start producing back at normal levels soon as power returns to many areas