Canadians for Affordable Energy President Dan McTeague says energy traders so far don’t see the Isreal/Iran geopolitical conflict to be a big deal, meaning gas prices in Prince George should remain as is.
McTeague told MyPGNow.com when there has been a conflict in the Persian Gulf in the past, which has 40% of the world’s oil, gas prices have followed suit – but not this time.
“They have been very muted this time. Although oil has gone up ten bucks a barrel, gasoline has not followed the market that is relevant for us here in Prince George, which is the Chicago comprehensive or the Chicago spot market – so far it has gone up twelve cents a gallon and there has not been much movement.”
“We still remain range-bound in the dollar-sixty range and that is likely to stay until markets can decide whether this is going to be resolved quickly or we are looking at a more protracting or escalating geopolitical factors many of us didn’t see coming a few weeks ago.”
McTeague added the only way the tension between the two countries could escalate into something is if additional countries get involved, which could impact fuel prices.
“This could very easily move into something beyond just a conflict between Israel and Iran. It is important for Israel and the rest of the world that Iran does not develop a bomb and of course, Iran, which is a proxy for many other groups around the world, has allies including China.”
McTeague noted Iran has some strategic options to stop the flow of oil by closing the Strait of Hormuz, which is a 30-kilometre choke point following some recent Israeli strikes.
The vast majority of gas stations in Prince George are under a buck-thirty a litre, including Costco.
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