Tulsa gasoline prices shoot up 12 cents overnight
BY ROD WALTON World Staff Writer
Friday, August 17, 2012
8/17/12 at 3:34 AM
Read more energy stories that impact Tulsa.
The double-edge sword of higher gasoline prices fell hard on Tulsa motorists again Thursday.
Many QuikTrip stations raised the retail price for regular unleaded 12 cents overnight to $3.559 per gallon. The price is less than a nickel lower than the 2012 high for Tulsa.
"Who gets hurt? It hurts you and me, the consumers of gasoline," Steve Agee, dean of the Oklahoma City University Meinders School of Business. "It helps the state of Oklahoma with the gross production tax, royalty owners and producers."
Tulsa-based QuikTrip Corp., the city's largest convenience store chain, often is a price-setter for gasoline. Thursday's price was the highest since $3.569 on April 9 and 4 cents off the 2012 high of $3.599 that was being charged April 4.
The overall Tulsa average, as calculated by travel club AAA, is typically a few cents higher than QuikTrip because of several factors. QuikTrip sells gasoline blended with up to 10 percent ethanol, which is subsidized by some states, while some other stations sell E0, or pure gasoline, at a higher cost.
AAA-Oklahoma spokesman Chuck Mai pointed out that the highest Tulsa average this year was $3.638 on April 6. The price norm was $2.95 on Dec. 28.
Wholesale gasoline prices, however, have been on a tear lately, rising to nearly $3.50 per gallon in Thursday trading. Analysts have blamed the crude oil and subsequent wholesale surges on everything from an improving economy to fears that Israel will attack Iran over its nuclear program.
"There's a different set of factors every day, but they keep coming around like a bad penny," Mai said. "I think it's a lot of skittishness. I think the market in New York is very nervous about where oil should be."
Benchmark U.S. crude oil futures rose for the third straight day, adding $1.27 to settle at $95.60 per barrel on the New York Mercantile Exchange. Recent federal Energy Information Administration reports have noted a drop in oil inventories.
Couple those supply concerns with the demands of the summer driving season and the result is typically higher gasoline prices. The national average was $3.71 as of Wednesday, while nearby Oklahoma City was at $3.54 before the latest price changes.
Refinery issues nationwide include recent fires at Chevron Corp. in San Francisco and the HollyFrontier Corp. diesel hydrotreater in Tulsa. Damage at the west Tulsa refinery could take up to two months to repair and may cause up to 1 million barrels in lost fuel production.
But industry observers from Mai to Tom Kloza of the Oil Price Information Service have been assuring consumers that the price won't keep going up - or will it?
"I really have to believe we've seen the high-water mark or we will shortly," Mai said. "Those refinery problems are working themselves out. We've had no major hurricanes threatening Gulf production, and the driving season in Oklahoma is at its end.
"The last three inventory reports show a declining stockpile of oil, but it's still above where we were a year ago."
OCU economist Agee also believes that consumers will find some relief in the gasoline marketplace due to both downward pricing pressures and technology advances. The shale oil boom should increase supplies while a move to compressed natural gas vehicles, if and when it happens, also should help.
"I'm optimistic about the long-term energy outlook," he said.
Agee acknowledged that consumers are feeling some short-term pain tied to fuel prices, but he pointed out it pales in comparison to the run-up in the summer of 2008 when regular unleaded almost hit $4 per gallon in Tulsa. A subsequent cutback in driving by Americans, in combination with the Great Recession, pushed down the price rather quickly.
Agee still believes that energy efficiency also can play an active role this time around.
"We don't have to cut back, but we need to use it wisely," he said. "When you underinflate your tires or don't change your oil regularly, when you don't handle things like you should, you're wasting energy."
Tulsa gasoline prices*
A week ago: $3.499
One month ago: $3.399
This year's high: $3.599 (April 4)
One year ago: $3.329.
* Observed price at QuikTrip stations.
Original Print Headline: Tulsa gas prices jump 12 cents overnight
Rod Walton 918-581-8457