AAA says gas prices close to gouging
Advertiser Staff and News Services
TAMPA, Fla. — The recent spike in gasoline prices isn't justified and is getting "uncomfortably close" to gouging, a spokesman for the AAA said yesterday.
The price of a gallon of regular gasoline has risen about 13 cents in less than two weeks to a national average of $1.633 — the highest since June 2001, according to the automobile association.
In Hawai'i, the average price of a regular gallon yesterday was $1.863, an increase of 18 cents per gallon from a year ago, when the average price was $1.685.
Maui had the highest prices among the locations surveyed by the AAA in Hawai'i, with a gallon of gasoline averaging $2.079 in Wailuku. The average price in Hilo was $1.939, while in Honolulu the average was $1.798. The highest recorded price was $2.299 in Hilo on July 3, 2001.
Kaua'i and Kona, where fuel prices are often among the highest in the state, were not surveyed.
Hawai'i lawmakers this session have been reviewing a pending state cap on wholesale and retail gasoline prices. The law, which takes effect July 1, 2004, regulates prices through a complex formula, but would affect only prices for self-serve regular.
The oil industry has blamed higher prices on tensions in the Middle East and a strike in Venezuela that has crippled that nation's petroleum industry. Venezuela is one of the largest exporters of crude oil to the United States.
Although Hawai'i gets most of its petroleum from Alaska and Asia, other factors contribute to high prices in Hawai'i, including its low-tech, small-volume refineries that refine expensive forms of crude oil, according to a recent state consultant study. Also, local refiners charge higher prices for gasoline to compensate for lower-margin products such as jet fuel and fuel oil, which is used to generate electricity.
AAA spokesman Geoff Sundstrom said that nothing has occurred in the market to warrant the increase seen nationally. Sundstrom suggested that oil companies are looking ahead to what could happen to crude oil prices if the United States invades Iraq.
The organization urged the industry to show restraint and said it "stands ready to support government action against companies that unfairly profit from any future national emergency."
John Felmy, chief economist at the American Petroleum Institute, which represents the U.S. oil industry, said any suggestion of price gouging is "inappropriate."
He said retail gas prices are simply tracking the rising cost of crude oil. The wholesale price of a barrel of light sweet crude was $36.10 yesterday, up from $33.67 on Jan. 31.
"This is a market that moves," he said.
The AAA is the nation's largest auto club, with more than 44 million members.
