Oil hits six-year low as gas prices rise in Canada

Oil prices hit their lowest point since March 2009 this morning, with the crude contract for the North American benchmark known as West Texas Intermediate falling to $41.35 US a barrel.

By the end of the day, WTI ended down again from its last close, at $42.14. Meanwhile, most Canadians are paying more at the pumps. The Prairies and parts of British Columbia. saw a 16-cent hike in gas prices overnight Wednesday.

One of the causes is said to be a refinery plant in Indiana, which supplies western Canada, dropped capacity to 50 per cent recently for unscheduled repairs.

Roger McKnight, chief petroleum analyst for En-Pro International told CBC News, the shut-down has raised fears of a shortage.

“If I’m a refiner in Edmonton and I see I can get $1.10/L for gasoline in Minneapolis, whereas my price is $1 in Edmonton, I’m going to export that to the United States – or I’m going to raise my wholesale prices to match the U.S. ones,” he said.

“And you can just thank NAFTA…Because gasoline can be imported or exported across the border under NAFTA rules depending on which refiner can get the better price on either side of the border.”

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