Prices as high in Cape as anyone remembers

Thursday, April 7, 2005

If the price of gas has ever been higher than $2.12 in Cape Girardeau -- as it was in several gas stations Wednesday -- many people can't recall when.

"It's as high as I can remember," said Rebecca Galloway of Cape Girardeau as she fueled up her 1995 minivan. "Last week it was $2.05, this week it's $2.12. That's only three days later."

Harkening memories of the oil crisis of the early 1980s, the average price of fuel has rocketed to national average of $2.20 for regular gasoline, up 6.4 cents from a week ago. A year ago, the national average was $1.76.

The prices in Cape Girardeau are well below the national average, but that doesn't appease people like Galloway.

"We don't drive anymore unless we have to," she said. "We're only putting $10 in our tank because it costs too much to fill up."

Prices are rising in all regions of the country as the price of wholesale gas lingers around $1.70 a gallon. Retail prices are generally thought to be 60 to 65 cents higher than wholesale.

If the $2.12 is a record high locally, Scott Blank of Bi-State Oil Co. says it's not as bad as it could be. Though national records have been set in recent weeks, when adjusted for inflation, gas was more expensive during the 1981 oil crisis when it was as high as $2.99 in today's dollars.

Bi-State operates two convenience stores and one discount gas station. Blank has been in business eight years and can't ever remember prices being this high.

He said the reason for the rising prices is simple economics: Supply and demand.

"Demand is increasing. Not only for us but globally, and the supply is not there. When you've got demand and the supply lines are cut down, it's going to affect the prices. It's simple: Oil is fleeting, but the population is growing."

Blank said there are reasons to be optimistic, however. On Tuesday, he saw the price of wholesale gas drop 4 cents for the first time in several days.

In recent weeks, Blank said he's seen prices go up as much as 6 to 10 cents overnight.

"It varies like the stock market," he said. "But we haven't really noticed a hit in sales."

But Blank said that's something to be cautious about.

"My opinion is, if this trend keeps up it's going to affect our economy," he said. "A lot of people are on fixed incomes. You mess with fuel, you're messing with a major part of the economy."

Jim Maurer of Rhodes 101 says prices at Rhodes, which has stations across Southeast Missouri, have never climbed higher than $2 in the past.

But Maurer said prices could creep even higher.

"Everything we're being told is that the barrel price is going to go up," he said. "I've even heard $100 a barrel. If that's true, we've got a ways to go."

The Energy Information Administration says pump prices are expected to keep rising through the Memorial Day holiday in late May, the beginning of the busy U.S. summer driving season.

Don Dredmond is a spokesman with AAA, which monitors gas prices. He said the price of gas is intricately tied to the price of crude oil. He said record highs for the price of crude oil have been registered in recent weeks.

He agreed with Blank that demand has followed the price of gas upward. For the first quarter of 2005, demand exceeded supply by 2 percent, he said.

Linda Powell said she feels the pain of high gas prices even more because she drives from her home in Olive Branch, Ill., to her job in Cape Girardeau.

"It's costing me a lot more to get to work," she said as she fueled up Tuesday. "I make the same salary, but I'm paying more to get there. That's what makes it hard."

335-6611, extension 137

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