Gas prices will likely remain high | PostIndependent.com

Gas prices will likely remain high

Bobby MagillPost Independent Staff

It’s a cliche because it’s true: Filling up at the gas pump these days is just as horrifying and painful as the stabbing scene in Alfred Hitchcock’s “Psycho.”Gas prices in Glenwood Springs Friday ranged from $2.93 per gallon of regular unleaded at the Grand Avenue Sinclair station to $3.06 at the Sixth Street Conoco and Shell stations. And, as has been reported ad nauseum on TV and elsewhere, there’s no relief in sight. At least not until the winter, barring instability in Iran and a devastating hurricane season, according to AAA Colorado spokeswoman Alexa Gromko. Average prices of a gallon of regular unleaded in Denver and Grand Junction are significantly lower than those in the Roaring Fork Valley. Gromko speculated that’s because of the cost of trucking the gasoline here, though slightly lower prices in more remote regions of Colorado illustrate trucking costs may not be the only factor playing into the valley’s high gasoline prices. The gasoline price forecast is complex, she said, but there’s a good chance they could drop by as much as $1 after hurricane season ends in November. Prices are expected to remain at or above $3 in Colorado throughout the summer, and they could rise significantly if tensions in Iran heat up and devastating hurricanes batter the United States, she said. What’s behind the recent spike in gas prices? Well, that’s hard to say. But Kirk Swallow, president of Rifle-based Swallow Oil Company, which distributes gasoline to many Garfield County Phillips 66 stations, said high gas prices can be blamed on commodity traders who react to any word of instability in oil-exporting countries. Expect their emotions to keep the oil prices high, he said. “Futures on crude oil out to 2010 are being sold above $60 a barrel,” he said. “The price is going to be high. I don’t know what the answer is.”Company Vice President Chris Swallow said the oil companies are to blame: “If you look at the news this morning, they were talking about the five major oil companies and what their first quarter profits are – in the billions,” he said. “We’re catching all the crap and the blame for it,” he said, but local suppliers are still earning about the same profit from each gallon of gasoline sold now as when gas was half as much. Kirk Swallow said his company makes 18 cents per gallon sold, down from 20 cents when gas was $1.50 per gallon. “The poor retailers are really sucking it up,” he said. He said some of those retailers, including Kroger-owned City Market, sell their gasoline at a loss, also called a “loss leader,” which lures people to the store where they buy other items that make money for the company. City Market sells gasoline at its Grand Junction and Montrose stores, but not in the Roaring Fork Valley. A spokesperson could not be reached for comment. Another challenge gasoline retailers are facing is the cost per credit card transaction, which runs about 2.5 percent, Kirk Swallow said. He said that Visa and Mastercard are doing serious harm to local retailers. Swallow Oil can’t charge a lower price for gas purchased with cash unless his stations install cash acceptors at each pump.Chris and Kirk Swallow predicted that people will cut back on their gasoline consumption as prices climb. But according to AAA, travel bookings are up as much as 10 percent this summer over last summer, when gasoline was about $1 cheaper per gallon. All costs associated with all kinds of travel will also be about 5 percent higher than last year.Those numbers prove one thing, Gromko said: “There are things people will not give up in life, and vacations are one of them.”But, she said, people will begin to travel smarter by cutting back on spontaneous weekend trips and using less gasoline by driving the speed limit.”The days right now of carefree driving are on the back burner,” she said. “You really have to pay attention to conservation when you’re on the road.”For the latest gasoline price statistics, log onto http://www.aaa.com. Average prices of a gallon of regular unleaded on Friday:$3.01: Glenwood Springs$2.68: Glenwood Springs one month ago$2.46: Glenwood Springs one year ago$2.82: Denver$2.76: Grand Junction$2.45: Casper, Wyo. $2.77: Anchorage, Alaska$3.17: New York City$3.30: Santa Barbara, Calif. $3.52: Wailuku, HawaiiSource: AAA Colorado


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