Gas prices shoot higher; no end near

Tuesday, 28 June 2005

Better get your gas now.

By BRAD KANE
bradkane@sanduskyregister.com

SANDUSKY - If you think you'll need gasoline at all in the next 10 days or so, better get it right now.

With demand increasing, a busy three-day holiday weekend coming soon and the price per barrel of crude oil topping a huge milestone Monday, chances are the price at the pump will get ridiculous in the near future.

"People are going to be flocking here this weekend," Sandusky/Erie County Visitor & Convention Bureau Executive Director Joan Van Offeren said.

In trading throughout the world, the price per barrel of crude oil topped the $60 mark.

"That's amazing. I'd never dreamed I'd see a price for crude oil like that," said Thomas Stewart, executive vice president for the Ohio Oil & Gas Association.

The $60 barrier was psychologically important to the trading market, experts said. While traders had been shy about breaking the $60 ceiling, now that it has been ruptured, it will increase rapidly.

"The psychology of the market is that once $60 is breached, then there is tendency to test how much higher it can go, or how long $60 can be sustained," said Victor Shum, petroleum analyst at Texas-headquartered energy consultants Purvin & Gertz in Singapore.

In the United States, demand is still on the rise even though the average price per gallon is up 40 percent from one year ago and on Monday was $2.203, according to the Automobile Association of America. Americans use roughly 25 percent of the 84 million barrels of crude oil the world demands each day, Stewart said.

Even as several countries talked Monday about increasing their barrel per day output, including the Organization of Petroleum Exporting Counties, that won't do much to limit the price at the pump.

The problem is having enough refineries to make the crude oil into gasoline, Stewart said. U.S. refineries are already running at 97-percent capacity, so there is not much more they can produce.

Since supply isn't going up, the only thing left to do with the rising demand is to increase the price, he said.

Demand will go up in the Firelands area over the holiday weekend as it tends to be one of the busier ones of the summer.

"Fourth of July weekend is a big weekend for us," Cedar Point spokesman Robin Innes said. "Because of the three-day weekend, Sunday will probably be our busiest day."

In calls to six Sandusky-area gas stations Monday afternoon, the average price was $2.231 per gallon. That is 3 to 9 cents higher than the average price per gallon in the eight major areas of the state in which Ohio AAA keeps track of gas prices.

For people living in the area, the best thing to do is find out-of-the-way areas and gas stations that tourists won't know about, Van Offeren said.

"Apparently, it is consistently less expensive there," she said.

Associated Press writers George Jahn and En-Lai Yeoh contributed to this story.

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