Keep gas supply fair: Kinew to fuel companies during pipeline shutdown

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This article was published 21/03/2024 (589 days ago), so information in it may no longer be current.

Manitoba Premier Wab Kinew is calling on gasoline suppliers not to ration fuel after an unplanned pipeline shutdown south of Winnipeg earlier this week.

Blaming “market inefficiencies” for some city gas stations running out of fuel, limiting gas purchases or closing some pumps this week, Kinew said he’s directed oil and gas companies to fairly distribute fuel to suppliers so all gas stations and fuel retailers have access across the province.

“We need to ensure that there is regular entry into the province of these 50,000 barrels a day that are coming in by train car and truck, but we also need to make sure that that supply is being distributed equitably across the different regions who need it, across the different sectors of the economy — we’re heading into seeding season as well — but also, to all the different retailers of fuel in our province,” the premier said at an unrelated news conference Thursday.

“We’ve communicated this directly to the oil and gas companies that you need to provide access to all the suppliers and distributors so all of the retailers can have access.”

A government spokesman told the Free Press there are no significant concerns about supply at this time.

During question period, Kinew said most suppliers told the government they have an 11-day supply of gasoline, while some have enough to last two weeks, as shipments continue.

Kinew said he has called in the federal Competition Bureau to ensure equitable distribution of gasoline during the shutdown of the Imperial Oil pipeline, located between Gretna and Winnipeg.

In a statement, a spokesperson for the Competition Bureau said it would investigate if it finds evidence of price fixing, supply restriction, market allocation or any other anti-competitive behaviour in the gasoline market.

While motorists have been told not to fill extra jerry cans or stockpile gas, “suppliers should not be hoarding gasoline, either,” he said.

Unplanned maintenance of the pipeline, which supplies gasoline, diesel and jet fuel to Winnipeg and surrounding communities, means fuel is being brought in by trucks and trains.

Imperial Oil announced last Sunday crews need to replace a section of pipe that runs under the Red River near St. Adolphe, about 30 kilometres south of Winnipeg.

The pipeline is expected to be out of commission for three months.

Edmonton-based company spokeswoman Keri Scobie said truck and rail deliveries are happening seamlessly, while a supply team works “around the clock.”

It was business as usual at most Winnipeg gas stations visited by the Free Press Thursday afternoon.

Some stations operated by 204 Fuels, a small family-owned company, were out of fuel. Staff at locations on Pembina Highway and Waverley Street said deliveries were expected in the evening.

Robert Parsons, a sessional instructor in the supply chain management department at the University of Manitoba’s Asper School of Business, said some stations could experience an initial “blip,” where they temporarily run out of fuel, but the interim delivery system will catch up.

There’s no need for Manitobans to panic buy or hoard gasoline like they did toilet paper during the COVID-19 pandemic, he added.

“It’s inconvenient, but we know how long it is, roughly, going to take,” said Parsons. “What we need to do is get over this initial hump.”

Parsons said 50,000 barrels per day amounts to about eight million litres of fuel.

He pointed to Statistics Canada’s latest net sales data, which showed about six million litres of gasoline and diesel oil for road motor vehicles was purchased per day in Manitoba in 2022.

Given gasoline has “lots of price volatility,” the shutdown will likely influence the cost at the pumps, said Parsons.

“I think everyone can expect it’s going to go up a bit,” he said. “If we went up by five cents or so, that wouldn’t be unrealistic.”

Kinew said the government is closely monitoring prices and will “take further steps to keep gas affordable” if prices rise because of the shutdown.

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Gas prices have gone up by at least six cents a litre in Winnipeg since last week, but that increase is tied to the rising price of crude oil, the province has said.

Most stations were charging just shy of $1.40 per litre of regular gasoline Thursday afternoon. Some were closer to $1.30 or $1.34 per litre.

Kinew’s government cut the provincial 14 per cent gas tax Jan. 1. The government planned reinstate it after July 1. The premier hasn’t said whether he’ll extend the tax break.

katie.may@freepress.mb.ca

chris.kitching@freepress.mb.ca

Katie May
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Katie May is a multimedia producer for the Free Press.

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Chris Kitching
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As a general assignment reporter, Chris covers a little bit of everything for the Free Press.

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