Local News
GAS WARS


SCOTT LESLIE


I
t’s déjà vu all over again on Ontario Street in St. Catharines. Back in August of 2015, a gas war erupted between an Esso station on 408 Ontario Street and a Pioneer outlet on nearby 383 Ontario Street. The two began shaving several cents off their retail price to an average of 85 cents per litre, offering some of the cheapest gas in Ontario. The resulting war forced several stations in the Garden City to cut their prices in order to keep up.

Now it’s the summer of 2017 – and the war has resumed.

It’s been a boon for local motorists. Some residents from the surrounding communities – and even as far off as Hamilton – have jumped on the bandwagon at times, making a special trip to Ontario Street to take advantage of the cheap rates.

Gas prices have risen markedly in Niagara over the past year – particularly since the Ontario government put a new cap-and-trade program in place back in January designed to tax companies that produce carbon dioxide. This has added approximately 4.3 cents to the price of a litre of gas at the pumps. 

But even when provincial and federal taxes are thrown into the mix, Ontario Street has still bucked the price trend. On July 14th for instance, the Pioneer and Esso stations sat at 95.9 and 96.2 respectively – the cheapest gas prices in Niagara and substantially lower than the average price in the province of 106.1. (The lowest gas price in Ontario on that day was 93.5 at Stop & Save Variety near Concession #12 in Hagersville.)

During a gas war, stations normally sell their gas at a lower retail price than it would cost them to acquire their gas wholesale. As large corporate entities, Pioneer and Esso have deeper pockets and are able to make up some of the price gap with increased convenience store sales.

But some of the smaller independently owned gas stations in the city are disappointed with the ongoing gas war which has broken out intermittently over the past two years.

“As a whole, it affects everything in St. Catharines because all traffic is drawn to that area, depending how low the prices are,” says Jessica Friesen, the CEO of Gales Gas Bar which operates a gas station on 270 Ontario Street. “February of 2016 is when it got to be its most extreme. At that point and time, they were approximately 20 cents below [the] buying [price].” 

One of the drawbacks of the situation is the additional traffic that has affected nearby businesses. At its worst, cars have been backed up on both sides of Ontario Street, blocking north and southbound lanes, which creates occasional traffic jams – and headaches for local merchants.

“I’m surprised that something serious hasn’t happened such as someone getting hit by a car,” Jessica says, “just because of how bad the lineups are down there. I’ve been there before when it’s backed up onto the on-ramp to the QEW.”

Constable Phil Gavin, media relations officer for the Niagara Regional Police, says the nature of the congestion has ebbed and flowed ever since the gas wars started.  

“It’s been a reoccurring issue,” he says. “Members of the public have expressed their concern regarding congestion and backed up roads so it is something we’ve tried to deal with.” 

The Niagara Regional Police are encouraging drivers to avoid joining any long lineups at the gas stations that might block the flow of traffic because it can lead to potential collisions. However, Phil says the managers of Esso and Pioneer are both doing their best to keep any customer overflow off Ontario Street by rerouting the entrances to their stations. 

“We’ve certainly had meetings with them to try and figure out ways to mitigate the problem,” he says, “and I think Esso and the Pioneer have both taken steps along that way.”

Despite the hazards, many local motorists seem content to wait 10 or 20 minutes to take advantage of the marked discounts at Esso’s and Pioneer’s pumps. And with Ontario Street experiencing its second year of gas wars – and counting – there may be no immediate end in sight.

“When you’re talking about a conglomerate like Imperial Oil which owns Esso,” Jessica admits, “they make such a margin on the refinery end of things that this may not be a big deal to them.” BL