Oil company profits soar as B.C. pump prices hit record highs

Drivers fueling up in downtown Vancouver on Tuesday managed to save a couple of bucks compared to those who pulled in on Monday, but 219 cents per litre doesn’t feel like a deal.

The price per litre hit a record of 222.9 cents on Monday.

“Why won’t this Premier keep his promise to help us on sky-high gas prices?” Surrey White-Rock MLA Trevor Halford asked in Question Period, as the BC Liberals tried to lay the blame at the feet of the governing NDP.

Premier John Horgan was not present so Government House Leader and Deputy Premier Mike Farnworth attempted to handle the questions.

"There has been a rebate going out to assist people dealing with the cost of living, which includes gas prices,” Farnworth said. “Those cheques are going out, those debits are going out, this very month,”

The rebate, which was announced at the end of March, will average about $110 for most drivers in the province.

The BC Liberals want the government to do more and suggested it could add another rebate using the Climate Action Tax Credit.

They also suggested a break on the province’s fuel tax.

“We have suggested that they could suspend provincial gas taxes like they did in Alberta, which did see a 13 cent a litre drop at the pump,” said Finance Critic Peter Milobar who represents Kamloops-North Thompson.

According to UBC Sauder School of Business Economist Werner Antweiler, Alberta can afford to temporarily suspend the provincial fuel tax but B.C. cannot.

As oil prices have surged in recent weeks and months, so have royalties Alberta collects from producers.

As long as West Texas Intermediate continues to sell at more than $90 per barrel, Alberta’s budget will not take a hit from the fuel tax suspension.

Wednesday afternoon, WTI was trading for more than $99 per barrel.

“If B.C. cuts fuel taxes, the money is missing from other government programs,” Antweiler said. “Who is going to make up the shortfall?”

BC expects to generate $992-million in revenue from the fuel tax this year.

As the BC Liberals and NDP sparred over the issue in Question Period, BC Green Party leader Sonia Furstenau rose to make a point.

“Oil and gas companies, including the ones in Canada, are taking home a lot of profits,” Furstenau said.

As drivers from coast to coast face record prices at the pump, Canadian oil companies have seen profits surge.

Cenovus recently announced its best first-quarter profit ever as the company raked in $1.6-billion, compared to $220-million dollars in the first quarter of last year.

Imperial Oil had its best opening quarter in 30 years as it posted profits of $1.17-billion.

Canadian Natural resources more than doubled its year-over-year first quarter numbers with a profit of $3.1-billion.

And Suncor brought home $2.95-billion in quarter one, nearly quadrupling last year’s results of $800-million.

Amid surging global demand following a pandemic slump, the war in Ukraine has choked supply and caused oil prices to soar.

"All these things combined, higher taxes, carbon taxes, these things add up to what is going to be the perfect storm for a lot of consumers this summer,” said gas price analyst Dan McTeague.

He went on to predict a minor dip of a few cents per litre in the days ahead before prices spike back up to new record highs across the country over the coming May long weekend.