Quebec, Quebec – In the last of a series of three questions to Quebec’s main political parties during the current election campaign, CAA-Quebec has asked whether they plan to review the method for calculating the minimum estimated price (MEP) of petroleum products, so as to ensure that pump prices for gasoline are set more realistically.
The association said that in its current form, MEP is detrimental to a true free market for gasoline, because the Régie de l’énergie du Québec calculates it only once a week, and is too often used as an excuse by the petroleum industry to delay reducing pump prices whenever the market is declining. “Without the restriction caused by the weekly setting of the MEP, pump prices could more promptly reflect downturns in the petroleum cost indicators – that is, the price of crude oil and that of refined gasoline – in the same way as they so quickly reflect increases in those indicators,” said Sophie Gagnon, CAA-Quebec’s Senior Director of Public and Government Relations.
CAA-Quebec said that it has long advocated daily calculation of the MEP, which would prevent the “false sense of normalcy” that prevails when pump prices remain stable in an obviously declining price context. The association said that this situation “has often allowed the major oil companies and independents alike to increase their profits.” CAA-Quebec said that the phenomenon has been observed in the Quebec City region, among others, since 2005.