Economy
Gas prices plummet in BC thanks to TMX pipeline expansion
From Resource Works
By more than doubling capacity and cutting down the costs, the benefits of the TMX expansion are keeping more money in consumer pockets.
Just months after the Trans Mountain Expansion (TMX) project was completed last year, Canadians, especially British Columbians, are experiencing the benefits promised by this once-maligned but invaluable piece of infrastructure. As prices fall when people gas up their cars, the effects are evident for all to see.
This drop in gasoline prices is a welcome new reality for consumers across B.C. and a long-overdue relief given the painful inflation of the past few years.
TMX has helped broaden Canadian oil’s access to world markets like never before, improve supply chains, and boost regional fuel supplies—all of which are helping keep money in the pockets of the middle class.
When TMX was approaching the finish line after the new year, it was praised for promising to ease long-standing capacity issues and help eliminate less efficient, pricier methods of shipping oil. By mid-May, TMX was completed and in full swing, with early data suggesting that gas prices in Vancouver were slackening compared to other cities in Canada.
Kent Fellows, an assistant professor of Economics and the Director of Graduate Programs for the School of Public Policy at the University of Calgary, noted that wholesale prices in Vancouver fell by roughly 28 cents per litre compared to the typically lower prices in Edmonton, thanks to the expanded capacity of TMX. Consequently, the actual price at the gas pump in the Lower Mainland fell too, providing relief to a part of Canada that traditionally suffers from high fuel costs.
In large part due to limited pipeline capacity, Vancouver’s gas prices have been higher than the rest of the country. From at least 2008 to this year, TMX’s capacity was unable to accommodate demand, leading to the generational issue of “apportionment,” which meant rationing pipeline space to manage excess demand.
Under the apportionment regime, customers received less fuel than they requested, which increased costs. With the expansion of TMX now complete, the pipeline’s capacity has more than doubled from 350,000 barrels per day to 890,000, effectively neutralizing the apportionment problem for now.
Since May, TMX has operated at 80 percent capacity, with no apportionment affecting customers or consumers.
Before the TMX expansion was completed, a litre of gas in Vancouver cost 45 cents more than a litre in Edmonton. By August, it was just 17 cents—a remarkable drop that underscores why it’s crucial to expand B.C.’s capacity to move energy sources like oil without the need for costly alternatives, allowing consumers to enjoy savings at the pump.
More than doubling TMX’s capacity has rapidly reshaped B.C.’s energy landscape. Despite tensions in the Middle East, per-litre gas prices in Vancouver have fallen from about $2.30 per litre to $1.54 this month. Even when there was a slight disruption in October, the price only rose to about $1.80, far below its earlier peaks.
As Kent Fellows noted, the only real change during this entire timeline has been the completion of the TMX expansion, and the benefits extend far beyond the province’s shores.
With TMX moving over 500,000 barrels more per day than it did previously, Canadian oil is now far more plentiful on the international market. Tankers routinely depart Burrard Inlet loaded with oil bound for destinations in South Korea and Japan.
In this uncertain world, where oil markets remain volatile, TMX serves as a stabilizing force for both Canada and the world. People in B.C. can rest easier with TMX acting as a barrier against sharp shifts in supply and demand.
For critics who argue that the $31 billion invested in the project is short-sighted, the benefits for everyday people are becoming increasingly evident in a province where families have endured high gas prices for years.
Economy
One Solution to Canada’s Housing Crisis: Move. Toronto loses nearly half million people to more affordable locations
From the Frontier Centre for Public Policy
By Wendell Cox
The largest CMA, Toronto, had by far the most significant net internal migration loss at 402,600, Montreal lost 162,700, and Vancouver lost 49,700.
Canadians are fleeing overpriced cities to find more affordable housing. And restrictive urban planning policies are to blame.
Canadians may be solving the housing crisis on their own by moving away from more expensive areas to areas where housing is much more affordable. This trend is highlighted in the latest internal migration data from Statistics Canada.
The data covers 167 areas comprising the entire nation, including Census Metropolitan Areas (CMAs), which have populations from 100,000 to seven million. It also includes the smaller Census Agglomerations (CAs), which have a core population of at least 10,000, as well as areas outside CMAs and CAs in each province and territory, which are referred to as “largely rural areas.”
Long-standing migration trends have been virtually reversed. Larger cities (CMAs) now see the highest loss of net internal migrants, while smaller cities (CAs) are experiencing solid gains. Between 2019 and 2023, Canada’s CMAs lost 273,800 net internal migrants to smaller areas, including CAs and largely rural areas. This contrasts sharply with the previous five-year period (2014 to 2018) when CMAs saw only a 1,000-person loss.
So, where did these people go? A significant portion – 108,100 – moved to CAs, which captured 39 per cent of the CMA losses. This is triple that of the previous five years (2014 through 2018).
However, the most notable shift occurred in largely rural areas, which gained 165,700 net internal migrants, representing 61 per cent of CMA losses. This is a dramatic increase compared to the 33,700 net loss in the previous five years.
Among the 167 areas, the migration data is stunning.
The areas experiencing the greatest net internal migration are outside CMAs and CAs. The largely rural area of Ontario saw the biggest gain, with a net increase of 78,300 people – nearly 40 times the number from the previous five years. Meanwhile, rural Quebec placed second, with a net gain of 76,200 people, more than 10 times the increase in the prior five years. The Calgary CMA ranked third (and first among CMAs) at 42,600, followed by the Ottawa Gatineau CMA (Ontario and Quebec) at 36,700 and the Oshawa CMA at 34,900.
The largest CMA, Toronto, had by far the most significant net internal migration loss at 402,600, Montreal lost 162,700, and Vancouver lost 49,700. Outside these CMAs, nearly all areas posted net gains.
People have also started moving to the Maritimes. The Halifax CMA tripled its previous gain (21,300). In New Brunswick, Moncton nearly quadrupled its gain (7,000). Modest gains were also made in Fredericton and Saint John as well as in Charlottetown in Prince Edward Island.
Meanwhile, housing affordability in Canada’s largest CMAs has become grim. Toronto’s median house price to median household income has doubled in less than two decades. Vancouver’s prices have tripled relative to incomes in five decades. Montreal’s house prices nearly doubled relative to incomes over two decades.
These CMAs (and others) have housing policies typical of the international planning orthodoxy, which seeks to make cities denser. In effect, they have declared war against “urban sprawl,” trying to stop any material expansion of urbanization. These urban containment policies, which include greenbelts, agricultural reserves, urban growth boundaries and compact city strategies, are associated with the worst housing affordability. Land prices are skewed upward throughout the market. Demand continues to increase ahead of incomes, but the supply of low-cost suburban land, so crucial to controlling costs, is frozen.
Regrettably, some areas where people have fled are also subject to urban containment and housing affordability has deteriorated rapidly. Between 2015 and 2022, prices in Ontario CMAs London, Guelph, Brantford and St. Catharines have about doubled. BC’s Fraser Valley and Vancouver Island have seen similar increases. Those moving to these areas are ahead financially, but the rapidly rising house prices are closing opportunities.
There are proposals to restore housing affordability, though none tackle the urban containment policies associated with the price increases. Indeed, we have not found a single metropolitan area where housing affordability has been restored with the market distortions of the intensity that have developed in Toronto, Vancouver and Montreal (not in our Demographia International Housing Affordability report or elsewhere). Such markets have become unsustainable for most new entrant households because they cannot afford to live there.
Housing is not a commodity. Households have varying preferences, from ground-oriented housing (detached and townhomes) to high-rise condos. Indeed, a growing body of literature associates detached housing with higher total fertility rates. According to Statistics Canada, Canadians have favoured lower densities for decades, a trend that continued through the 2021 Census, a trend that continued through the 2021 Census, according to Statistics Canada.
With governments (virtually around the world) failing to maintain stable and affordable housing markets, it’s not surprising people are taking matters into their own hands. Until fundamental reforms can be implemented in the most expensive markets, those seeking a better quality of life will have no choice but to leave.
First published in the Financial Post.
Wendell Cox is a senior fellow at the Frontier Centre for Public Policy and the author of Demographia International Housing Affordability.
Business
‘We Had A Bad Experience’: Chinese Officials Losing Sleep Over Thought Of Dealing With Second Trump Term
From the Daily Caller News Foundation
By Jake Smith
Chinese Communist Party (CCP) officials quietly believe that a second Donald Trump presidency would be more dangerous to them than a Kamala Harris administration, The Wall Street Journal reported on Tuesday.
The Biden-Harris administration’s relationship with Beijing has been marred with tensions in recent years over diplomatic, economic and national security disputes. But Chinese officials would seemingly still rather have Harris win in November over Trump because they worry that the former president will open up another trade war against China, officials told the WSJ.
“Chinese officials and scholars, in private conversations over many months, are largely exceptionally wary of a Trump victory,” Richard McGregor, China expert at the Lowy Institute in Sydney, told the WSJ.
Those worries are largely kept quiet. Publicly, Chinese officials maintain a stance of neutrality toward the U.S. elections. Chinese President Xi Jinping wrote in a letter last week that China had always handled relations with the U.S. with “mutual respect” and said that Beijing “is willing to work with the United States as partners and friends.”
“The presidential elections are the United States’ own affairs,” a spokesman from the Chinese Embassy in the U.S. told the Daily Caller News Foundation. “We hope that whoever gets elected will be committed to growing sound and stable China-U.S. ties.”
Beijing wants whoever the next president is to take a predictable stance toward relations and dial back the U.S.’ tough-on-China stance. Privately, officials felt that standard was better reflected in President Joe Biden over Trump and thought his reelection would be better for China, according to the WSJ.
After Biden dropped out of the race in July, Beijing felt the same about Harris, officials told the WSJ.
“Under Trump, we had a bad experience,” senior CCP diplomat Liu Jianchao bemoaned during a closed-door session with U.S. think tanks earlier in the year.
The concerns of a second Trump term among Chinese officials stem from fears he will launch a second trade war against China, as he did in his first term, according to the WSJ.
Trump issued a sweeping set of tariffs against China during his first term — adding a tax to imports coming in from the country — in a bid to encourage domestic U.S. investment and compel China to buy more American goods.
Xi and those and his orbit became exhausted in trying to maneuver the trade war and Trump’s demands, according to the WSJ. Trump has weighed the idea in his second term to issue a 60% tariff against incoming Chinese goods, which economists at UBS have predicted could mark a 2.5% blow to China’s GDP growth over a year-long period.
Trump has also recently weighed the idea of using the threat of tariffs to deter China from invading Taiwan, even musing that he would completely halt trade relations if the island is taken by force, which has been received extremely poorly in Beijing.
“I would say: If you go into Taiwan, I’m sorry to do this, I’m going to tax you”—meaning impose tariffs—“at 150% to 200%,” Trump told the WSJ in an interview on Thursday.
The Trump and Harris campaigns did not immediately respond to a request for comment.
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