New Brunswick gas stations want EUB review of retail margins for fuel

New Brunswick gas station owners say some perceptions about their businesses getting rich from historically high fuel prices are in fact the other way around.

Dale Mott, the owner of two rural gas stations in Willow Grove and Kingston, says smaller and smaller profits since the start of the pandemic have become zilch since fuel hit $2 a litre.

“That’s when we started losing money,” says Mott. “Every time the price of fuel goes up, I make the comment I keep throwing dead money in the ground.”

New Brunswick’s maximum retail margin for each type of motor fuel is 7.33 cents per litre, with most service stations selling for less, at a margin of five to six cents per litre.

The margin, set by New Brunswick’s Energy and Utilities Board (EUB), doesn’t change regardless of where the price lands. When prices expand, the profit margin for retailers shrink.

Mott says the high fuel prices are being exacerbated by a number of other factors.

“The small retailer is being squeezed on inventory costs, insurance costs, overhead costs, and I don’t think the general public realizes that. We would like to see the price down as much as they would.”

The Convenience Industry Council of Canada says it will soon file a motion with New Brunswick’s EUB to review the current margin mechanism.

“There’s a high level of concern and retailers are wondering what the future looks like,” says Mike Hammoud, the council’s vice-president for Atlantic Canada.

“Just so we’re clear, we’re not blaming the New Brunswick EUB on what’s happening right now. Nobody could have ever foreseen what’s happening with gas prices today. The struggle is it’s not sustainable.”

Hammoud says the EUB will begin a review next week looking at the retail margins for 2019 to 2020. Hammoud is hoping the review will be extended to present day worries.

“We would like to find some sort of a short-term solution that could help these retailers out,” he said.