Gas Prices Surge As Crude Oil Hits Record, This Morning, the Average Cost of Regular Unleaded Was $3.03
By MATTHEW THOMPSON
DAILY MAIL STAFF
Record-high crude oil prices are causing a strain on the wallets of local gasoline customers.
Across the area this morning, the average price for regular unleaded was $3.03, according to Internet fuel tracker, gasbuddy.com.
The average was up from the $2.86 a gallon that area customers paid one week ago.
Jan Vineyard, executive director of the West Virginia Oil Marketers and Grocers Association, said increases in crude oil prices are the reason behind the price surge at the pump.
On Monday, prices rose to a record high $93.80 a barrel during trading on the international markets.
Vineyard said the status of crude oil plays a big part in what people pay at the pump.
“Crude oil prices are always the biggest factor for gas prices,” Vineyard said. “It’s the main reason for us to pay more.”
The price surge was partly driven by news that Mexico’s state oil company, Petroleos Mexicanos, or Pemex, was to temporarily halt as much as 600,000 barrels of daily crude production, due to stormy weather.
Earlier today, concerns eased over the disruption of supply from Mexico. Prices came down slightly to $92.77 a barrel in Asian electronic trading on the New York Mercantile Exchange, midafternoon in Singapore.
Also lifting prices was the declining U.S. dollar, which has drawn investors to dollar-denominated crude futures and increased the appeal of oil as an alternative investment, analysts say.
Prices have also been supported by fighting in Turkey between armed forces and Kurdish rebels, and the U.S. government’s imposition last week of harsh penalties against Iran, the world’s fourth largest oil producer.
Across Kanawha County, the cheapest gas was $2.97 found at the Pilot station off Interstate 64 in Nitro, according to gasbuddy.com. The most expensive gas was $3.09 a gallon at the Exxon at 332 Campbells Creek.
Vineyard said the time between crude oil increases and price jumps at the pump depends on how much inventory station owners have.
“If crude goes up and they are tight on inventory, then you may see prices go up a bit quicker,” Vineyard said. “But if the inventory is in good shape, it may take some time before prices increase.”
Jack Campbell, owner of Colonial Exxon on Bridge Road, raised his gas prices to $3.09 on Monday.
The price jump came after Campbell’s station received a shipment of fuel on Monday.
“I got my load and the wholesale price was up,” Campbell said. “What I pay for the gas is what determines what my customers pay.”
Campbell said he does not know if prices would go up again until his next fuel load arrives.
He said the station receives about four loads a week. The next one is scheduled for tomorrow.
So far, he said the price increase has not hurt his business.
“I don’t think folks are paying that much attention to it,” Campbell said. “It’s gotten to the point where people don’t watch it as close because it’s up and down so much.”
With the markets so volatile, Vineyard said it’s difficult to predict if any more intense increases will be seen.
“Every time I predict I’m off,” Vineyard said. “I can’t in the short term predict what’s going to happen.”
Oil prices could get another boost this week if the U.S. Federal Reserve cuts interest rates at its policy meeting Wednesday.
The Associated Press contributed to this report.
Contact writer Matthew Thompson at matthewthompson@dailymail.com or 348-4834.
(c) 2007 Charleston Daily Mail. Provided by ProQuest Information and Learning. All rights Reserved.