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Gas Pains; State's Record Prices Fourth-Highest in Nation

Posted on: Sunday, 7 August 2005, 18:00 CDT

Clark County drivers began paying record-high gasoline prices this week as the global cost of oil hit new highs.

According to AAA Oregon-Idaho, the average price of a gallon of unleaded regular gas in Vancouver was $2.429 on Friday, surpassing the previous record set in April of $2.425.

Washington's average unleaded regular gas price at $2.518 a gallon was also an all-time high Friday, said AAA. That's the fourth- highest state average in the nation, topped by Hawaii at $2.65 a gallon; California, $2.59; and Nevada, $2.52.

In Oregon, the average was $2.45.

"The period of declining fuel prices that began in late spring has ended," said Elliott Eki, public and government affairs director for AAA Oregon-Idaho, in a weekly report. "Retail gasoline prices once again are moving upward as crude oil, again, is at record highs."

Washington's new 5-cent a gallon gas tax, which kicked in on July 1, has also added to the higher cost.

Lingering concerns that the gasoline supply in the U.S. could fail to meet peak demand this summer was at the heart of the price increases this week, according to an Associated Press report on oil prices.

Light, sweet crude for September delivery gained 56 cents to $61.94 a barrel in Friday afternoon trading on the New York Mercantile Exchange.

"Looking at the overall refinery situation, I think people are still having jitters from all the recent destruction we've seen in the U.S.," Jonathan Copus, energy analyst with Investec Securities in London, told the AP.

Refinery woes

At least seven refineries have reported problems of one kind or another, ranging from fires at Chevron Corp.'s El Segundo, Calif., and BP PLC's Texas City refineries to the complete shutdown of Exxon Mobil's plant in Illinois.

While the growing economy, with a strong jobs report Friday, provides good news, it could also mean higher demand for oil. Aging refineries in the U.S. are running at nearly 100 percent utilization, and this increases the likelihood of operational problems as companies begin to slow production of gasoline for summer and turn to heating oil production.

Crude prices are 39 percent higher than a year ago, but would still have to surpass $90 a barrel to reach the all-time inflation- adjusted high set in 1980, according to the report.

Julia Anderson is The Columbian's business editor. She can be reached at 360-759-8071, or by e-mail at julia.anderson@columbian.com.

Update

Previously: In April, the price of regular unleaded gasoline hit a record high of $2.425 a gallon.

What's new: On Friday, the average gas price set a record in Vancouver of $2.429.

What's next: Prices could go higher if demand outstrips supply as U.S. refineries run at full capacity.

Source: Columbian

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