Average gas price eclipses $2 mark - State motorists paying 2 to 4 cents more per day

www.sanmateocountytimes.com112711222135,00.html Article Last Updated: Wednesday, March 05, 2003 - 5:43:13 AM PST By Brian McClimans, BUSINESS WRITER

The average gas price in California has passed $2 a gallon, according to the separate findings by the California Energy Commission and the AAA of Northern California. Overnight on Monday, gas prices rose 2 to 3 cents per gallon in many areas, according to AAA. As of Tuesday the statewide average was $2.04 per gallon. The average price in Oakland was $2.09, up 2 cents since Monday. Last month it was $1.80 a gallon and last year $1.31 a gallon, AAA said.

Even discount stations, including those run by Safeway and Costco, are approaching $2.

"We had at least a glimmer of hope last week that prices were stabilizing," said Sean Comey, a AAA spokesman.

But in the past week prices have been going up 2 to 4 cents per day, Comey said.

"Normally, we see a six-week lag time ... between increase in crude price and the price at the gas pump," Comey said. "Recently, they've gone up almost hand in hand. It has a lot of people asking questions."

The California Energy Commission has been monitoring the prices, but there isn't much it can do, said spokesman Rob Schlichting.

"This is an unregulated commodity," he said. "We've been monitoring the situation carefully to see that there are no refinery problems and to see what sort of problems there are that are causing these increases."

The commission said most of the increases are due to the war fears in Iraq, continued supply problems in Venezuela and Nigeria, and a handful of refineries down for repair in California. Wholesale gas prices range from $1.28 to $1.40 per gallon.

"They're going to use every issue they can to justify supply and demand in the rise in the pricing," said Dennis DeCota, executive director of the California Service Station & Automotive Repair Association and owner of a 76-Circle K branded station in San Anselmo.

DeCota said the high prices are hurting his station and his reputation with longtime customers. Neighboring unbranded stations are selling for less and DeCota said he can't lower his prices without going broke.

The state is watching the situation.

"If there is evidence that the oil companies are colluding, than the (state) Attorney General's Office could step in," Schlichting said. "The government, in this kind of a free market, doesn't have a lot that they can do. They certainly can't set oil prices."

Schlichting said motorists just need to shop around for the best price, since the gas coming out of the pump is the same at all the stations.

Comey said the San Francisco-based auto club has been fielding complaints from many of its members fed up with the high gas prices.

"The wild card in this whole gas price scenario is the possibility of going to war with Iraq," with the wholesale oil markets reacting on the threat of something happening, Comey said.

Comey said there are things motorists can do to save money. Beyond the basics of running a fuel efficient vehicle, AAA said motorists need to shop around.

"We're encouraging the consumer to shop aggressively for the price of gas," he said. "You may see a gas station that's equally convenient to go to that offers a better price."

Brian McClimans can be reached at (925) 416-4807 and bmcclimans@angnewspapers.com .