Average cost of gasoline in California hits $2 mark
Statewide average gasoline prices at the pump have jumped more than 18 percent over the last month to $2.01 from $1.70. This is the first time that average prices moved above the $2 barrier.
PALM SPRINGS -- The average price of a gallon of regular gasoline in California has broken the $2 barrier for the first time.
The California Energy Commission, a Sacramento agency that monitors energy issues, said Monday that regular gasoline averaged $2.01 a gallon statewide for the week ended March 3.
Regular gas statewide on average now costs 43.5 cents a gallon more than it did the first week of January, and 68 cents more than it did at this time last year.
In the Automobile Club of Southern California’s latest gas price survey, Palm Springs averaged $1.97 per gallon of gas.
"They’re inching toward that $2 barrier, and probably will hit it in a matter of days," said Jeff Spring, a spokesman for the Santa Ana-based automobile club.
The club is expected to issue its monthly fuel report on average gas prices for cities like Palm Springs and others in the Coachella Valley on March 11.
Terry Parker, director of maintenance operations and transportation for the Desert Sands Unified School District, is getting dizzy over the rapid rise in gas prices.
He’s thinking of ways to renegotiate gas prices with two local supply vendors, and get better deals on repair parts.
Under a worst-case scenario, he might even have to consider layoffs, he said.
The district budgeted $110,000 for fuel costs in its fiscal year ending June 30.
Over the past two months, however, fuel prices have jumped 18 percent on average for diesel and regular gasoline -- and there are four months left in the fiscal year, Parker said.
That’s a projected $20,000 over annual budget, he estimates.
The fuel is needed to run a fleet of 62 buses, and transport a sizeable chunk of the La Quinta-based district’s 25,000 students.
"We have to cut back across the board, not just in fuel prices, but we’re going to have other budget shortfalls as well," said Parker of budget cuts that have been passed along by the state.
For some motorists, the stratospheric gas prices might not mean much.
David Murphy, president and co-owner of Desert European Motorcars Ltd., isn’t worried about his clientele, for instance.
"A rise of 50 cents on the gallon isn’t going to affect them to drive down the street from El Paseo to downtown Palm Springs," Murphy said.
Murphy’s high-brow dealerships in Rancho Mirage and Palm Springs sell Bentley and Rolls-Royce automobiles, Jaguars, Porsches, BMWs and Mercedes Benzs.
"They are probably spending more for heating oil for their other home in Aspen (Colorado) than on their other car," he added.
Crude oil prices have soared because of uncertainty about supplies from the Middle East given the U.S. saber rattling over Iraq, as well as oil supply problems in Venezuela and Nigeria.
In addition, continuing cold temperatures in the eastern United States have increased the demand for heating oil, increasing the competition for available oil supplies.
Additional factors are at work in California as well. Several refineries are down for planned yearly maintenance, tightening supplies and increasing prices on the spot market, explained Rob Schlichting, a spokesman with the California Energy Commission.
When gas prices are adjusted for inflation, gasoline has been more expensive in the past, Schlichting explained.
Average pump prices of $1.34 a gallon in 1981, for example, equate to $2.45 a gallon in today’s dollars.
Schlicting urged motorists to shop around for gas because retail prices varied as much as 30 cents a gallon from station to station in its price survey.
Pat Maio is the Business Editor for The Desert Sun. He can be reached at 778-4625 or via e-mail at pat.maio@thedesertsun.com