OTTAWA (Reuters) - The Canadian government will ask the energy industry to explain why gasoline prices are so high but doesn’t have “a magic wand” to bring relief to consumers, Industry Minister Tony Clement said on Thursday.
The pro-market Conservative government is very unlikely to intervene directly to curb prices that have hit C$1.50 ($1.55) a liter or more in some places, past highs seen during the last spike in 2008.
Public unhappiness over the issue could become a political problem for the Conservatives, whose power base is in Western Canada, a major oil and gas-producing region.
“If a magic wand could solve this problem, it would all have been solved by now ... these are complex issues,” Clement told a news conference in Toronto.
“Canadians want and deserve answers about high gas prices,” Clement said, vowing to ask refiners, distributors and retailers to appear before a parliamentary committee in Ottawa to explain their pricing methods.
Parliament has not yet resumed in the wake of the Conservatives’ victory in the May 2 general election, so the earliest a hearing could be held is sometime in June.
Finance Minister Jim Flaherty said earlier that there is an adequate supply of oil in the world, adding that Canada’s independent Competition Bureau has the power to act if it felt there might be abuses.
“Governments around the world should not be regulating all these markets ... that’s a sure way to make sure that the market doesn’t work to lower prices when commodities are in more plentiful supply,” he told the Canadian Broadcasting Corp late on Wednesday.
Asked what Ottawa could do, he replied: “We can make sure the Competition Bureau does its job, make sure there’s adequate competition in the area. This is a market-driven situation.”
The Canadian Petroleum Products Institute, which represents the industry in Ottawa, blamed volatility for the spike.
Spokesman Carol Montreuil said prices were affected by what he called the complex interaction between the international oil extraction industry, refiners in North America and Canadian retailers.
“The price of crude ... is one key variable, by far the most important one, over which we have really little control,” he said, citing instability in oil-producing regions.
Additional reporting by Louise Egan; editing by Peter Galloway