The premier of Newfoundland, Brian Tobin, says he's considering government intervention to bring down the price of heating oil.

The province is Canada's newest oil producer. But Newfoundlanders pay some of the highest prices for oil in the country. Tobin is determined to change that.

The home heating bills of many Newfoundlanders has risen significantly this year. Many, especially those on a fixed income, are finding it hard to cope. Resident Phyllis Mashburn says her bill has almost doubled: last year home fuel cost 26 cents a litre; now it's 50 cents.

Premier Tobin

"Everything keeps going up and up, leaving no money for food or anything else," Mashburn says. "You hear on TV and radio how great everything is in Newfoundland. Well, I heard a couple of people say yesterday say, 'We got nothing left to do. We got to get rid of the house, we just can't keep up with all the utilities.'"

The oil companies say the 40 per cent increase over the past year can be blamed on the price of crude. Premier Tobin accepts that -- to a point.

"When oil prices go up, fair enough," says the premier. "But they've got to come down when oil prices go down and they've got to go down as fast as they're going up. And to this point in time I'm not sure this is always the case."

Tobin has refused in the past to look at a regulatory body for the oil industry but now he says it's time. The proposed watchdog would ensure that consumer prices stay in line with the price of crude.

"We're looking at a form of regulation, a mechanism that provides for more regular observation of what's going on," the premier said Tuesday.

Irving Oil says regulation won't bring the cost down.

"I think it would be an additional cost that would eventually be passed on to the consumer," says David French, a spokesperson for Irving in St. John's. "Regulation has not proved overly successful in any other jurisdiction to our knowledge."

French attributes the recent increase in part to a cold snap in the northeastern United States. He suggests that as weather improves there, the price of oil is likely to come down anyway.