Gasoline jumps 13 cents overnight
www.stltoday.com By Patrick L. Thimangu Of the Post-Dispatch updated: 03/06/2003 06:47 PM
The average price of gasoline in St. Louis jumped more than 8 percent Wednesday, in sync with the volatility that has rocked U.S. energy markets for the last month.
The average price of a gallon of self-serve unleaded regular in the metro area rose to $1.68, from $1.55 on Tuesday, according to AAA Missouri.
Gasoline prices have been rising in the last year nationwide, but they shot up last month when crude-oil prices came close to $40 a barrel. The run-up was sparked by worries about war in Iraq and low production in Venezuela, a major oil exporter that has had labor and political problems.
Demand for energy to heat houses and businesses also has been high, because of the cold winter.
The spike in crude-oil prices also showed up at gasoline pumps in St. Louis, where a gallon of regular unleaded rose to $1.72 on Feb. 13. Gasoline had never been that expensive in the region at this time of the year, said Mike Right, who compiles a regular survey of prices at gas stations in south and west St. Louis County for AAA.
Area gasoline prices reached the record high, $1.77 a gallon, on May 17, 2001, he said.
In some parts of the nation, gasoline prices passed $2 a gallon last week. On Wednesday, a gallon of gasoline was selling for an average of $1.97 in California and $1.50 in Georgia, according to GasBuddy Organization Inc., a nonprofit group that tracks gasoline price trends across the United States and Canada.
Jason Toews, co-founder of GasBuddy, said prices in St. Louis have mirrored trends in other U.S. cities in the last few weeks.
He said crude-oil prices are falling - crude oil for April delivery closed at $36.69 Wednesday on the New York Mercantile Exchange - but that doesn't mean prices at the pump will drop immediately.
In fact, the increase in retail prices now could be the result of last week's futures run-up, Toews said.
"We are seeing prices go up all over the country," he said.
Toews said gasoline prices are likely to remain volatile in coming weeks because many refineries have started switching to summer blends. The change temporarily squeezes the gas supply.
While gasoline prices may seem high in the St. Louis region and the rest of the nation, they are cheaper than two decades ago if inflation is taken into account. Gasoline also is more affordable than in Europe.
According to the American Petroleum Institute, a trade group, average gasoline prices in the United States are 39 percent lower than the 1981 inflation-adjusted high of $2.70 a gallon. The institute estimates the real cost of gasoline to consumers has fallen $1.05 a gallon in the last two decades.
The Energy Information Administration, the data-collection arm of the Energy Department, said the average price of premium gasoline in the Netherlands was $4.92 a gallon, $4.47 in Germany and $4.43 in Belgium during the week ended Feb. 24.
The average price for premium gasoline in the United States that week was $1.84.
Reporter Patrick L. Thimangu: E-mail: pthimangu@post-dispatch.com Phone: 314-340-8320