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Summertime blues: Gas prices to keep rising
By JEFF HARRINGTON © St. Petersburg Times, published May 8, 2001 The pain at the pump is getting worse just in time for summer vacation. On Monday, AAA Auto Club South estimated the average price for regular unleaded at $1.598 a gallon in the Tampa Bay area, up nearly 20 cents from a month ago and nearly a dime since a spike in mid April.
Nationally, AAA reported the average price at $1.679 a gallon, up from $1.46 a month ago. Statewide, Florida's $1.64 a gallon compared with $1.95 in California and $1.89 in Illinois. And there were reports of some Chicago-area stations hitting $2 a gallon. Does that mean gasoline prices will just keep getting worse through the summer driving season? Maybe, maybe not. As prices have risen, a spate of refinery shutdowns spurred concern that inventories, especially of the cleaner-burning reformulated grades sold in the nation's biggest cities, will stay below year-ago levels when demand peaks this summer. The prospect of $3-a-gallon gasoline was even broached Monday. Representatives of Chevron Corp. and Shell Petroleum told service station owners in Chicago and California to brace for prices that high this summer, USA Today reported, citing more than 20 service station owners. Hit by reporters with that possible scenario, White House Press Secretary Ari Fleischer said not to expect any intercession from President Bush. "There is a sense of urgency -- no one wants to pay $3 a gallon," Fleischer said. "But the president is going to be realistic. He will resist the siren song of moving from one short-term solution to another." A task force headed by Vice President Dick Cheney, a former chairman and chief executive officer of Dallas-based Halliburton Co., the largest oil-services company, is slated this month to send Bush recommendations on how to ensure the United States has the energy it needs. Other energy experts say $3 a gallon isn't likely, anyway. With more suppliers rushing in recently to capitalize on demand, some oil industry analysts say prices may not rise much more and may even drop by late July. "The worst may already be over, because refiners are getting caught up," energy analyst Phil Flynn said. Oil companies may be spreading the talk of $3 gasoline because "they want to cover all the bases and be prepared for the worst," said Aaron Brady, an analyst at Energy Security Analysis in Wakefield, Mass. "They are preparing the station owners for severe customer backlash if it comes." James Sweeney, a professor in the department of management science and engineering at Stanford University, said, "$3 a gallon is not very likely given that inventories are up right now." One wild card, Sweeney acknowledged, is the prospect of more refinery fires. Fires last month closed Tosco Corp. refineries in California and Illinois, helping push up their already soaring gas prices. Florida has been spared that problem, and the slow upward drift in prices seems to have muted customer complaints. Three weeks ago, the Amoco Station on North Dale Mabry at Interstate 275 in Tampa was inundated with calls after it boosted prices more than a dime a gallon to $1.59 for regular unleaded. Since then, the price has slowly risen a nickel to $1.64 but customers haven't complained at all, assistant manager Diane Gibson said Monday. The surge was most noticeable at stations that held off on increases last month. At a Marathon station on State Road 54 in Land O'Lakes, for instance, the pump price jumped from $1.379 on April 12 to $1.529 as of Monday. A nearby Cumberland Farms on State Road 54, however, reversed the trend. Unleaded regular was selling for $1.569 Monday, down from $1.599 in mid April. - Times staff writer Scott Barancik contributed to this report, which used information from Times wires.
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From the Times Business report
From the AP
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"Prices are just slowly, slowly creeping up," said Amy Newton of the auto club.
