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Gas companies gouging consumers, leaders say

Globe and Mail Update and Canadian Press

HALIFAX — It seems Stephen Harper and Stéphane Dion finally agree on something: Big oil companies, they say, are gouging consumers at the gas pump.

Conservative Leader Mr. Harper was first to level the accusation on Friday, saying he's planning to lay out a promise to address this later in the campaign.

“It certainly appears that way to me,” Mr. Harper said of rising gas prices.

He didn't reveal what he's got in store. “We will be making some announcements on this issue a little later in the campaign – we do have some policy to say,” the Conservative Leader said.

Responding to reporters' questions at his first event in British Columbia of the election campaign, the Liberal leader agreed –in part – with his rival's comments.

Gas prices at the pumps increased dramatically today, rising between 12 and 13 cents per litre in some parts of the country.

Mr. Dion said, however, that the pricing issue at the pumps wasn't the only reason for soaring gas prices, blaming “humanity” for asking for more and more oil.

He said his carbon tax scheme that would raise the price of carbon fuel and use that to give tax breaks to Canadian families would help to remedy part of the problem; his scheme would not raise prices at the pumps.

NDP Leader Jack Layton, who proposed Friday to take on gas-gouging oil companies with the creation of a price monitoring agency, dismissed Mr. Harper's promise to do something about fuel prices as empty words.

“What we've heard today is either nothing, or the equivalent of nothing, from the Prime Minister,” Mr. Layton told reporters at a campaign event at Memorial University in St. John's, Nfld.

The Conservative government and the Liberal governments that preceded it offered excuses when they were asked to do something about the gouging and the lack of competition being demonstrated at the gas pump, Mr. Layton said. “That's a defeatist attitude being taken by Mr. Harper.”

Mr. Harper pointed out the federal government has recently gone after gasoline retailers.

“In Quebec not too long ago, the Minister of Industry announced the prosecution of some companies for price gouging in the gasoline market. When did the previous [Liberal] government ever do that?” he said.

In June the federal Competition Bureau, an independent agency not controlled by the Harper government, announced that charges of price fixing had been laid against 13 individuals and 11 companies accused of fixing the price of gasoline at the pump in Quebec.

Mr. Harper said he is leery of responding on the fly to changes in gas prices, adding he's learned over the years in politics it's unwise to do so.

Still, Mr. Harper said, Canadians should get used to high fuel prices.

“Energy prices are high and they're not likely to go down,” he said. “There's only so much we can do on energy prices.”

The Tory leader noted that his government cut the goods and services tax – which applies to fuel – and that's one way the Conservatives have tried to ease energy prices. “That's why this government brought in a reduction in the GST.”

Peter Boag, president of the Canadian Petroleum Products Institute, said the price spike is the result of an integrated North American fuel market, not price fixing.

“There's no unique Canadian market for fuels, we operate in the context of a North American market for fuel, so things that happen anywhere in North America have an impact on fuel prices in Canada.”

Refineries shutting down in the face of hurricane Ike, combined with other refineries that are only now coming back online after hurricane Gustav, means North American refining capacity has been reduced by 15 to 20 per cent in the last couple of days, said Boag.

He said that past experience suggests the price jump will be short term.

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