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08-25-03: Gas prices rocketing |
By SHELLEY GRIESHOP
sgrieshop@dailystandard.com
The upcoming Labor Day weekend and a variety of other international
issues have caused gasoline prices to skyrocket during the last few weeks.
The average price of unleaded gasoline per gallon locally is $1.75,
according to a random price check of 16 gasoline stations in Mercer and Auglaize counties.
The lowest price at the pump could be found at Chickasaw Quik Stop at $1.67 per gallon.
The highest price was $1.77, shared by seven different gasoline stations.
The area average is 5 to 7 cents higher than prices posted this morning
on the AAA Auto Club Web site for Dayton, Columbus, Cleveland and Cincinnati. The state
average this morning was $1.67; the national average was $1.66, according to Ohio AAA Auto
Club.
Prices have climbed about 15 cents in the last two to three weeks in
the Grand Lake St. Marys area.
"Unfortunately, a lot of things are happening at the same
time," explained Terry Fleming of the Ohio Petroleum Counsel in Columbus.
Fleming said although the oil strike in Venezuela ended last December,
the countries' production of oil has dropped from more than 70 percent to only 55-60
percent due to ongoing protest marches and "sick-outs" by workers there.
Production problems in Nigeria and Iraq, other countries which supply
oil to the United States, also have contributed to the rising gas prices in our country,
he added.
"Then there's the recent blackout," Fleming said, referring
to the largest blackout in history that darkened eight states and Canada last week.
"It (power outage) shut down two refineries in Toledo for two days."
On top of that, a Detroit, Mich., refinery remains closed due to the
blackout. Officials there are trying to bring the plant back up to full production slowly
to keep within EPA guidelines, he said.
"So right now, there is gasoline being shipped north from Ohio,
Wisconsin and Indiana to make up for the shortage," he explained.
Labor Day travel is expected to be heavier this year, AAA predicts, and
also is helping drive prices higher, Fleming admitted. The same time a year ago, local
average prices per gallon were $1.38.
"When you have heavy demand, prices will rise," he said,
calling the theory "basic marketing 101."
The price of crude oil rose from $25 per barrel to $32 recently -
causing an automatic 7-cent climb in gasoline prices per gallon.
"Crude prices are always the deciding factor for bottom-line
gasoline prices," Fleming said.
He also noted the Organization of the Petroleum Exporting Countries
(OPEC) recently decided not to increase production of oil.
In defense of the oil industry, Fleming reminded motorists that about
45 cents per gallon currently is federal and state taxes, making the actual gasoline price
approximately $1.30.
"Some people are paying $2 per gallon for water at the store and
not blinking an eye," he said. "And the poor guy at the gas station actually
makes more money when the price is lower, it costs him less."
Fleming asks drivers to have a little patience.
"In September, we switch to winter gasoline reserves, which are
less costly to refine and prices should go down somewhat," he said. "It's our
next silver lining." |
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