Quebec abolishes the floor price of gasoline: what impact?

Quebec abolishes the floor price of gasoline: what impact?
Quebec abolishes the floor price of gasoline: what impact?

The abolition of the floor price of gasoline in the province, announced last Thursday by Minister Pierre Fitzgibbon, is well received by the Canadian Taxpayers Federation, which however hopes that it will be one of several measures to reduce the cost at the pump for Quebecers.

“We think this is good news,” says the Quebec director of the Canadian Taxpayers Federation, Nicolas Gagnon. We even put pressure on the previous Minister of Energy, who at the time refused to withdraw this mechanism. Quebec is one of the rare jurisdictions that still had one that applied. This will allow gasoline distributors to offer a more competitive price to Quebec motorists. We see that very favorably. »

Mr. Gagnon believes that this measure will at least ensure that it is never illegal for gas stations to display a lower price.

“If, for example, you had a service station and you tried to distribute your gasoline at a lower price than that set by the Régie de l’énergie, you could receive a formal notice from your competitor. other side of the street, which, based on the estimate, could accuse you of unfair competition, he explains. Between 2018 and 2023, there were 4,787 formal notices distributed to gas stations in Quebec because they charged a price that was not high enough. That’s still 4,787 opportunities missed by Quebec motorists.”

The Canadian Taxpayers Federation plans to continue to put pressure on the Legault government to reduce fuel taxes.

“We hope that they will stay the course and do like other provinces like Manitoba, Ontario and Newfoundland and Labrador, where in certain jurisdictions we are applying a reduction in the provincial tax on gasoline, advances the director. In Quebec at the moment, between 38 and 40% of the price we pay at gas stations are taxes. »

Photo: Alain Morin

Another bell sound

Eliminating the floor price of gasoline will not make filling up cheaper for motorists, says the president of the Association of Canadians for Affordable Energy, Dan McTeague.

In interview on the show The Balance Sheet on LCN, the latter affirmed that it was more the American market, the value of the Canadian dollar and the absence of competition which influenced the price at the pump.

“With the loonie taking 136 cents to buy one American dollar, that means that here in Quebec, we pay around 28 cents per liter,” he maintains.

The lack of refineries in Canada also ensures that the price of gasoline remains high in the country.

“We no longer have refineries. We no longer have the Shell refinery in Montreal, we no longer have the Esso refinery in the Dartmouth region. We just have two refineries and they don’t really compete, because the prices are already determined in the United States,” says Dan McTeague.

As for the price of gasoline, which is higher in Quebec than elsewhere in the province, eliminating the floor price will not change anything, claims the expert.

“The comparison between Montreal and Quebec is simply a question of retailer margins. The retailer’s margin in Montreal is often 6 to 8 cents per liter, while in Quebec, it’s more like 9 to 12 cents per liter,” he explains.

See also: Top 10 vehicles that consume the most gasoline in 2024



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