Ottawa gas prices plunge below 70 cents for first time in 7 years
'This is a silly season,' says analyst Dan McTeague
It's been more than seven years since Ottawans have seen gas prices drop this low.
On Thursday afternoon, several gas stations in Ottawa — mostly Esso and Ultramar stations — were offering gas prices of 67.9 cents a litre, according to data collected by GasBuddy.com.
Several others were selling gas for less than 70 cents a litre. By late afternoon, GasBuddy was reporting the average price of gas in Ottawa at a mere 74 cents a litre.
Haven't seen gas this low in years. Fill 'em up <a href="https://twitter.com/hashtag/otttraffic?src=hash">#otttraffic</a> <a href="https://twitter.com/hashtag/ottnews?src=hash">#ottnews</a> <a href="https://t.co/5XYvS3bZBz">pic.twitter.com/5XYvS3bZBz</a>—@JudyTrinhCBC
"I think this is a silly season. It's been happening in Ottawa for the past five or six months," said GasBuddy.com senior policy analyst Dan McTeague.
"Prices are one thing in the morning. In the afternoon they drop back .... there's no rhyme or reason. It's clear that the titans are fighting this out."
According to fuel pricing data from Ontario's Ministry of Energy, the last time gas prices in Ottawa were this low was between November 2008 and January 2009, when the cost of a litre of fuel hovered between 60 and 75 cents.
Two years ago this February, the average price for a litre of fuel in Ottawa was about $1.26 — more than 50 cents higher than today's average.
The sudden fluctuations at the pumps are a clear sign of a "gas war" between the the major refinery-owning petroleum companies, who can afford to lose a bit of money on the retail market, said McTeague.
While the downwards dip is certainly great short-term news for consumers, the problem is that while those international corporations can sustain below-cost selling, independent retailers can't.
"Only the strong, large, dominant players can do this," said McTeague.
"Motorists should take it as a bit of a blessing, but the reality is that it does hide and mask over and possibly create an environment of fewer players down the road — which will mean higher prices. So short-term gain, long-term pain."