www.theledger.com Published Friday, February 21, 2003 By BRAD FOSS The Associated Press

The middle of winter feels more like the heart of summer at gas stations nationwide, as fuel prices surge past $2 a gallon in some places and motorists grumble about being gouged. When a gallon of gas costs more than a cup of gourmet coffee around the July 4 holiday, drivers chalk it up to industry greed during the peak driving season. Now consumers are accusing oil companies of taking advantage of the prospect of war in Iraq -- an allegation the industry brushes aside as a conspiracy theory. Gas station owners tell a more complicated story, explaining that today's high pump prices are partly the result of avarice, but not their own. The average retail price of regular unleaded has risen 56 cents since the beginning of the year to $1.66 a gallon. Meanwhile, wholesale gas prices have increased only 14 cents over the same period of time. That disparity is the source of ire for much of the public, while others accept high gas prices as a consequence of war rhetoric from the Bush administration. Earlier in the week, Sen. Charles Schumer, D-N.Y., called on the Federal Trade Commission to launch an investigation of industry practices. "It appears as if price gouging is taking place across the country," Schumer said in a letter to FTC chairman Timothy Muris. The American Automobile Association supports Schumer's request. The travel company said it is also concerned about why prices have gone up so much in such a short period of time, though a spokesman stopped short of using the term gouging. "We feel that most of the increase has been due to fear and speculation, rather than any change in the supply or demand for crude oil or gasoline," said Jeff Sunstrom, a spokesman for AAA. Regardless of the reasons, Sunstrom worries that today's high prices could be a harbinger of even costlier fuel by the end of April. "Watch out between April 15 and May 31," said Tom Kloza, director of Oil Price Information Service, a Lakewood, N.J., publisher of industry data. Kloza said the imports lost after Venezuela's oil workers went on strike in December have not been adequately replaced and that could be a problem when the weather heats up and demand rises. Trucker Tommy Wimberly paid $280 to fill up his rig with 166 gallons of diesel in Camillia, Ga., or about a third more than a month ago. "I don't like the high prices, but I'm not angry," said Wimberly, 43, who expects prices to go even higher if the United States goes to war with Iraq. "There's nothing I can do about it," he said. As the public face of the industry, gas station owners are frustrated by accusations of profiteering, but they insist they're not the ones to blame. They say suppliers have been steadily upping their "rack" prices for weeks and that station owners are merely passing along the changes to customers without any benefit to their bottom lines. "I realize that the price of a barrel of oil has gone up tremendously, but the way that rack prices have gone up for the last two weeks is just not right," said Richard Loeber, owner of a Hess station in Union Beach, N.J. About 40 percent of the retail cost of gasoline is attributed to the price of crude oil, which has risen 19 percent since the start of the year to $36.79 per barrel. Loeber and other retailers attribute the rapid increases to "zone pricing," a phenomenon in which suppliers value their product based upon the highest level a particular market will bear. For example, if their customers' rivals are getting a nickel more per gallon at the pump, they will set their rack price accordingly, even if the supplier's costs haven't gone up. "People know they're getting gouged, but believe me, it's not from the dealers," Loeber said. For its part, the petroleum industry fends off critics at times like these by pointing to higher oil prices. The surge has mainly been attributed to traders' fears of supply disruptions in the event of a war in Iraq and the impact of the Venezuelan oil strike.

Last modified: February 21. 2003 12:00AM

www.troyrecord.com By:, The Associated Press February 21, 2003

The middle of winter looks more like the heart of summer at gas stations nationwide, as fuel prices surge past $2 a gallon in some places and motorists grumble about being gouged.

Political instability in Venezuela and the prospect of war in Iraq are triggering price hikes that normally don't kick in until the peak driving season. And experts warn prices could shoot up even more as the political situations and the weather heat up. The average retail price for a gallon of regular unleaded, $1.66, has risen 56 cents since the beginning of the year. But because wholesale gas prices have increased just 14 cents over the same period of time, some consumers suspect oil companies are trying to cash in on market uncertainties. "I think it's just an excuse to raise prices," said Corina Alba, 22, of Anaheim, Calif. Sen. Charles Schumer, D-N.Y., called on the Federal Trade Commission this week to investigate industry practices. In a letter to FTC chairman Timothy Muris, the senator said: "It appears as if price gouging is taking place across the country." The American Automobile Association supports Schumer's request, but stopped short of using the word gouging. "We feel that most of the increase has been due to fear and speculation, rather than any change in the supply or demand for crude oil or gasoline," AAA spokesman Jeff Sunstrom said. Regardless of the reasons, Sunstrom said today's high prices could be a harbinger of even costlier fuel by the end of April. Tom Kloza, director of Oil Price Information Service, a Lakewood, N.J., publisher of industry data, said the imports lost after Venezuela's oil workers went on strike in December have not been adequately replaced and that could be a problem when the weather heats up and demand rises. Gas prices typically rise during spring, when refiners shift from winter- to summer-grade fuel. The switch to cleaner-burning gas requires shutting down equipment, scrubbing it clean and starting it up all over again - a process that causes supplies to contract and prices to move higher even under the best conditions. The impact of this switch already has been magnified by the possibility of a U.S.-led invasion of Iraq, analysts said. The petroleum industry contends gasoline prices are higher mainly because of traders' fears of supply disruptions in the event of a war in Iraq and the impact of the Venezuelan oil strike. "The fundamental thing is that crude prices have gone up dramatically," said John Felmy, chief economist at the American Petroleum Institute. About 40 percent of the retail cost of gasoline is attributed to the price of crude oil, which has risen 19 percent since the start of the year to $36.79 per barrel. Gas station owners say they are frustrated by accusations of profiteering and insist they are not to blame. They say suppliers have been raising their "rack" prices for weeks and that station owners are merely passing along those increases to customers. "I realize that the price of a barrel of oil has gone up tremendously, but the way that rack prices have gone up for the last two weeks is just not right," said Richard Loeber, owner of a gas station in Union Beach, N.J. Loeber said his supplier has raised the rack price by 16 cents a gallon in less than three weeks and that he has maintained his 8-cent-per-gallon margin all along. "People know they're getting gouged, but believe me, it's not from the dealers," Loeber said.

www.cjonline.com By Brad Foss The Associated Press

The middle of winter looks more like the heart of summer at gas stations nationwide, as fuel prices surge past $2 a gallon in some places and motorists grumble about being gouged.

Political instability in Venezuela and the prospect of war in Iraq are triggering price increases that normally don't kick in until the peak driving season. And experts warn prices could shoot up even more as the political situation and the weather heat up.

The average retail price for a gallon of regular unleaded, $1.66, has risen 56 cents since the beginning of the year.

But because wholesale gas prices have increased just 14 cents in the same period of time, some consumers suspect oil companies are trying to cash in on market uncertainties.

"I think it's just an excuse to raise prices," said Corina Alba, 22, of Anaheim, Calif.

Sen. Charles Schumer, D-N.Y., called on the Federal Trade Commission this week to investigate industry practices. In a letter to FTC chairman Timothy Muris, the senator said, "It appears as if price gouging is taking place across the country."

The American Automobile Association supports Schumer's request but stopped short of using the word gouging.

"We feel that most of the increase has been due to fear and speculation, rather than any change in the supply or demand for crude oil or gasoline," AAA spokesman Jeff Sunstrom said.

Regardless of the reasons, Sunstrom said today's high prices could be a harbinger of even costlier fuel by the end of April.

Tom Kloza, director of Oil Price Information Service, a Lakewood, N.J., publisher of industry data, said the imports lost after Venezuela's oil workers went on strike haven't been adequately replaced and that could be a problem when the weather heats up and demand rises.

Venezuela was the world's fifth-largest petroleum exporter and a major U.S. supplier before a general strike that began Dec. 2, seeking the ouster of President Hugo Chavez. The strike ended for all sectors except the oil industry Feb. 4.

Unrest flared again Thursday in the capital of Caracas, where thousands of people protested the arrest of a strike leader.

Gas prices typically rise during spring, when refiners shift from winter- to summer-grade fuel. The switch to cleaner-burning gas requires shutting down equipment, scrubbing it clean and starting it up all over again -- a process that causes supplies to contract and prices to move higher even under the best conditions.

The effect of this switch already has been magnified by the possibility of a U.S.-led invasion of Iraq, analysts said.

The petroleum industry contends gasoline prices are higher mainly because of traders' fears of supply disruptions in the event of a war in Iraq and the impact of the Venezuelan oil strike.

"The fundamental thing is that crude prices have gone up dramatically," said John Felmy, chief economist at the American Petroleum Institute.

About 40 percent of the retail cost of gasoline is attributed to the price of crude oil, which has risen 19 percent since the start of the year to $36.79 per barrel.

Oil prices could reach unprecedented levels -- perhaps as high as $50 a barrel -- if U.S.-led forces attack Iraq, Malaysian Prime Minister Mahathir Mohamad warned Thursday in an interview with The Associated Press. Malaysia is an oil producer but not a member of the Organization of Petroleum Exporting Countries, or OPEC.

Gas station owners say they are frustrated by accusations of profiteering and insist they aren't to blame. They say suppliers have been raising their "rack" prices for weeks and that station owners are merely passing along those increases to customers.

"I realize that the price of a barrel of oil has gone up tremendously, but the way that rack prices have gone up for the last two weeks is just not right," said Richard Loeber, owner of a gas station in Union Beach, N.J.

Loeber said his supplier has raised the rack price by 16 cents a gallon in less than three weeks and that he has maintained his 8-cent-per-gallon margin all along.

"People know they're getting gouged, but believe me, it's not from the dealers," Loeber said.

Last Modified: 1:15 a.m. - 2/20/2003

www.timesdispatch.com THE ASSOCIATED PRESS Feb 21, 2003

The middle of winter feels more like the heart of summer at gasoline stations nationwide, as fuel prices surge toward or past $2 a gallon and motorists grumble about being gouged.

When a gallon of gasoline costs more than a cup of gourmet coffee around the July Fourth holiday, drivers chalk it up to industry greed during the peak driving season.

But this winter consumers and others are accusing oil companies of taking advantage of the prospect of war in Iraq - an allegation the industry brushes aside as a conspiracy theory.

Gas station owners tell a more complicated story, explaining that today's high pump prices are partly the result of avarice, but not their own.

The average U.S. retail price of regular unleaded has risen 56 cents since the beginning of the year to $1.66 a gallon. Wholesale gas prices have increased 14 cents in the same period.

(In the lower Atlantic states, including Virginia, the average price of regu- lar unleaded gasoline at the pump was $1.595 in the week that ended Monday. That's up 20 cents from the beginning of the year, according to Department of Energy figures.)

While suppliers tack on costs for additives and transportation, the disparity is the source of ire for much of the public.

"This is ridiculous," said 20-year-old Jose Quiles, a tanning salon manager in Dallas who paid about $10 yesterday for a little more than 6 gallons of gas.

Earlier in the week, Sen. Charles E. Schumer, D-N.Y., called on the Federal Trade Commission to start an investigation of industry practices. "It appears as if price gouging is taking place across the country," Schumer said in a letter to FTC Chairman Timothy Muris.

The AAA supports Schumer's request. The travel company said it is also concerned about why prices have gone up so much in such a short period of time, though a spokesman stopped short of using the term gouging.

"We feel that most of the increase has been due to fear and speculation, rather than any change in the supply or demand for crude oil or gasoline," said Jeff Sunstrom, a spokesman for AAA. He worries that today's prices could be a harbinger of even costlier fuel before May.

"Watch out between April 15 and May 31," said Tom Kloza, director of Oil Price Information Service, a Lakewood, N.J., publisher of industry data. Kloza said the imports lost after Venezuela's oil workers went on strike in December have not been adequately replaced and that could be a problem when the weather heats up and demand rises.

Gasoline prices typically rise in the spring, when refiners shift from winterto summer-grade fuel. The switch to cleaner-burning gas requires shutting down equipment, scrubbing it clean and restarting it - a process that causes supplies to shrink and prices to rise even under the best conditions.

The public face of the industry - gas station owners - are frustrated by accusations of profiteering, but they insist they are not to blame. They say suppliers have been steadily upping their "rack" prices for weeks and that station owners are merely passing along the changes without any benefit to their bottom lines.

"I realize that the price of a barrel of oil has gone up tremendously, but the way that rack prices have gone up for the last two weeks is just not right," said Richard Loeber, owner of a Hess station in Union Beach, N.J. About 40 percent of the retail cost of gasoline is attributed to the price of crude oil, which has risen 19 percent since the start of the year to $36.79 per barrel.

Loeber said that Hess has raised the rack price by 16 cents a gallon in less than three weeks and that he has maintained his 8-cent-per-gallon margin.

Loeber and other retailers attribute the rapid increases to "zone pricing," a phenomenon in which suppliers value their product based on the highest level a particular market will bear. For example, if their customers' rivals are getting a nickel more per gallon at the pump, they will set their rack price accordingly, even if the supplier's costs have not increased.

"People know they're getting gouged, but believe me, it's not from the dealers," Loeber said.

The National Association of Convenience Stores, which represents about 100,000 sellers of gasoline, says its members are especially unhappy about the high gas prices because they detract from sales of soda and chips.

"Our members make more off a 12-ounce coffee than they do off a 12-gallon fill-up," said Jeff Lenard, the group's spokesman.

For its part, the petroleum industry fends off critics by pointing to higher oil prices. The surge has mainly been attributed to traders' fears of supply disruptions in the event of a war in Iraq and the impact of the Venezuelan oil strike.

www.lsj.com Published 2/21/2003 By Brad Foss Associated Press

The middle of winter feels more like the heart of summer at gas stations nationwide, as fuel prices surge past $2 a gallon in some places and motorists grumble about being gouged.

When a gallon of gas costs more than a cup of gourmet coffee around the July 4 holiday, drivers chalk it up to industry greed during the peak driving season. Now consumers are accusing oil companies of taking advantage of the prospect of war in Iraq - an allegation the industry brushes aside as a conspiracy theory.

Gas station owners tell a more complicated story, explaining that today's high pump prices are partly the result of avarice, but not their own.

The average retail price of regular unleaded has risen 22 cents since the beginning of the year to $1.66 a gallon. Meanwhile, wholesale prices paid by marketers have increased only 14 cents.

Corina Alba, 22, sees correlation between gas prices and the possibility of war in Iraq, but the Anaheim, Calif., resident doubts international affairs explain the situation. "I think it's just an excuse to raise prices," Alba said.

Earlier in the week, Sen. Charles Schumer, D-N.Y., called on the Federal Trade Commission to launch an investigation. "It appears as if price gouging is taking place across the country," Schumer said in a letter to FTC chairman Timothy Muris.

The American Automobile Association supports Schumer's request. The travel company said it is also concerned about why prices have gone up so much in such a short period of time, though a spokesman stopped short of using the term gouging.

"We feel that most of the increase has been due to fear and speculation, rather than any change in the supply or demand for crude oil or gasoline," said Jeff Sunstrom, a spokesman for AAA. Sunstrom worries that today's high prices could be a harbinger of even costlier fuel by the end of April.

"Watch out between April 15 and May 31," said Tom Kloza, director of Oil Price Information Service, a Lakewood, N.J., publisher of industry data. Kloza said the imports lost after Venezuela's oil workers went on strike in December have not been adequately replaced and that could be a problem when the weather heats up and demand rises.

Gas prices typically rise during spring, when refiners shift from winter- to summer-grade fuel. The switch to cleaner-burning gas requires shutting down equipment, scrubbing it clean and starting it up all over again - a process that causes prices to move higher.

Gas station owners are frustrated by accusations of profiteering, but insist they're not the ones to blame. They say suppliers have been steadily upping their "rack" prices for weeks and that station owners are passing along the changes to customers without any benefit to their bottom lines.

"I realize that the price of a barrel of oil has gone up tremendously, but the way that rack prices have gone up for the last two weeks is just not right," said Richard Loeber, owner of a Hess station in Union Beach, N.J. About 40 percent of the retail cost of gasoline is attributed to the price of crude oil, which has risen 19 percent since the start of the year to $36.79 per barrel.

Loeber said Hess has raised the rack price by 16 cents a gallon in less than three weeks and he has maintained his 8-cent-per-gallon margin all along.

Loeber and other retailers attribute the increases to "zone pricing," in which suppliers value their product based upon the highest level a market will bear.

"People know they're getting gouged, but believe me, it's not from the dealers," Loeber said.