Around the world, reactions to fuel prices have ranged from panic buying and traffic-clogging queues, to protests so violent they’ve prompted police to fire tear gas and water cannons.

Here in Toronto, drivers were forced to shell out as much as 3.6 extra cents a litre Wednesday, thanks to an overnight price jump at the pumps.

Is this normal volatility that’s fuelling violence, panic and frustration worldwide — the usual price jump before the busy summer months in North America, say — or is something larger at play? Are we headed for a fuel crisis?

The short answer, perhaps not surprisingly, is that there’s no short answer, according to Daniel Yergin, a Pulitzer Prize-winning author and energy expert. His new book, The Quest: Energy, Security, and the Remaking of the Modern World, explores the global struggle for control of oil.

There are two significant factors at play, he told the Star. The first is that emerging markets, such as China and India, now drive the oil market instead of industrial countries.

Then there’s heightened tensions between Iran and its rivals in the United States and Europe — something Yergin attributes to a November United Nations report warning the Middle Eastern country was assembling nuclear weapons capabilities.

Since that report, world oil prices have jumped a whopping 20 per cent, Yergin said.

Attempts are being made to squeeze Iranian oil out of the market; the recent European Union embargo on Iranian oil is one of the most significant examples.

Iran has responded with threats to close the Strait of Hormuz at the mouth of the Persian Gulf, the route for one-fifth of global oil.

“It is a tight market. The question is, if Iranian oil is squeezed out, what will replace it?” said Yergin.

Because of these two factors, “we’re kind of in a balancing period right now,” Yergin said.

The market will also change significantly in the next decade, he added, due to increasing oil production in Canada, the U.S. and Brazil.

Andrew Miall, professor of geology at the University of Toronto and an expert in gas and oil politics, doesn’t believe recent price hikes, protests or panic buying suggest major developments in the oil market.

He says concerns about reaching peak oil — when oil is used up faster than new reserves are found — are premature.

“We anticipate that the peak will arrive some time later this century,” he said.

Addressing the hike in gas prices, Miall said any number of factors can affect costs. Oil prices are determined by everything from the speculative wholesale price determined on the exchange market, to a tornado or a hurricane, to a breakdown at a particular refinery.

From there, these factors take time to affect pricing, he said.

“The blip in prices we’re seeing now could be the result of something that happened weeks ago or months ago or multiple things adding up,” he said.

Contrary to accusations of “corporate greed” often made when costs at the pump go up, he said competition between gas companies is so tight that “there’s very little room for price gouging.”

“Essentially, we have a market that’s working the way it’s supposed to work,” he said. “It’s competitive, and price rises and falls according to market conditions, and that’s what we’re supposed to believe is a good thing.”

With files from Star wire services

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Pump pain around the world

Fuel has been making headlines around the world for reasons ranging from the threat of strike to the end of government subsidies.

Britain

Panic buying was in full force in parts of England late last month as the union representing British fuel tanker drivers threatened to pull its vehicles from the road over a dispute about job security and working conditions.

Government ministers told consumers it was sensible to stock up at the pump and store gasoline in jerry cans at home, which sent sales soaring. Lines were so long at some gas stations that police ordered them to close to ease congestion.

The union later ruled out the threat of imminent strikes, but said it retains the right to call one.

Indonesia

Police in Indonesia last week fired tear gas and water cannons in clashes with demonstrators protesting a proposed fuel price hike. An estimated 81,000 protesters across the country gathered to oppose the controversial plan, which involved scrapping the country’s heavy fuel subsidies and would have raised prices by one-third. Around 8,000 soldiers and 14,000 police were sent to calm them.

The protesters ultimately had their way. The proposal — aimed at avoiding a budget deficit — was rejected.

Pakistan

A gas price hike — in some cases, up to 8.2 per cent — earlier this week sent protesters to the streets in Pakistan. Activists gathered in Islamabad and Karachi on Monday to demonstrate their disapproval one day after the government raised prices. The move went against the advice of the oil and gas regulatory authority.

Taiwan

It was the end of a long-standing government fuel subsidy, effective Monday, that sent the price of gas up 10 per cent in Taiwan, causing a public uproar. The country’s decision is intended to ease the burden on state-run oil firm CPC Corp. The price hike came two months after President Ma Ying-jeou was re-elected to his second term.

With files from Star wire services