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The Honolulu Advertiser
Posted on: Wednesday, April 18, 2007

Gas prices back above $3 a gallon on O'ahu

By Sean Hao and Curtis Lum
Advertiser Staff Writers

Robin Miyamoto of Hawai'i Kai was unfazed by word that the average price of gasoline on O'ahu had gone back above $3 a gallon. Miyamoto said she had stopped paying attention to the price — easier to do when you drive a 47-mile-per-gallon hybrid, as Miyamoto does.

JEFF WIDENER | The Honolulu Advertiser

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These were the prices at Kahala Shell yesterday.

JEFF WIDENER | The Honolulu Advertiser

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The average Honolulu gasoline price rose above $3 a gallon yesterday for the first time in nearly eight months.

Overall, the average price for regular has soared 16 cents a gallon in the last month to $3.006 yesterday, according to the AAA Daily Fuel Gauge Report. The jump at the pump comes amid a recent spike in crude oil prices.

With gas prices hovering near the $3 level for a few weeks, motorists yesterday took the latest price increase in stride.

"I actually didn't notice that it was over $3," said Hawai'i Kai resident Robin Miyamoto. "I stopped paying attention for a while because it had gone down and things seemed pretty stable."

Miyamoto doesn't have to worry as much as the average driver because she owns a Toyota Prius hybrid, which she said gets about 47 miles per gallon. She used to spend about $50 a week on gas and now pays $25 every two weeks.

She added that there isn't a limit on how much she's willing to pay for gas.

"I have to go places," Miyamoto said. "My husband and I work three days a week together so we try to take one car on those days. So we try to find ways to save."

For many people, cutting back on driving is not an option they are ready to consider.

"I need my truck to go to work, anyway, so I don't really care about the prices," said Jason Yoshimura, a construction worker from Kailua. "I just put gas wherever. I don't know what you can do about it, so no sense get all frustrated."

Katrina Florence just spent about $75 to fill her BMW sport utility vehicle and then declared, "I'm going hybrid." The Wilhelmina Rise resident says she buys gas once a week.

"I was just noticing that I had 250 miles on the tank and it costs me $75 to fill it up. That's not very good gas mileage," Florence said. "I want to go green and I'm thinking about getting a Lexus hybrid."

Hawai'i Kai resident Nan Le pulled up to a full-service pump, where prices ranged from $3.85 to $4.05 a gallon. Le said she did so to get a free car wash.

Le said she won't change her driving habits because of the high prices, nor will she exchange her Lexus IS 250 for a more economical car.

"We have no choice," she said about the gas prices. "Everybody's the same."

HELP NOT ON WAY

Relief from $3-plus gasoline prices may not come anytime soon.

"I absolutely think they're going to go higher before they go lower," said Bob Swartz, who operates Chevron stations in Kane'ohe and Kailua. Swartz, who was selling regular for $3.059 a gallon yesterday, predicted prices could rise to $3.20 a gallon this summer based on crude oil and Mainland gasoline price increases. "I think people should be prepared to pay a higher price for gasoline."

The state's high gasoline prices can be traced to numerous causes, including Hawai'i's small market size, geographic isolation and lack of Mainland-type competition. The nation's highest gasoline taxes also play a role. Lowering the taxes would help to lower prices in Hawai'i and bring them more in line with Mainland prices, according to oil industry officials. However, legislative proposals to reinstitute an 11-cent-a-gallon state tax break have stalled partly because of concerns that a tax cut won't lead to lower pump prices.

Swartz and other oil industry officials said a tax cut would cut prices.

"That would be nice and I would pass it on," Swartz said.

So why have Hawai'i gasoline prices started to creep back to the $3 mark after eight months?

"The increase in crude oil prices — now at more than $60 a barrel — has definitely been a factor in the cost of gasoline, and this is being reflected in the price of gasoline at the pump," said Nathan Hokama, a spokesman for Hawai'i refiner Tesoro Corp. "Retail gasoline prices in various regions across the country are also up as well."

Swartz and Bill Green, a former owner of, and now consultant to, Kahala Shell, said the recent spike in retail gasoline prices is a result of rising wholesale gasoline prices. Kahala Shell yesterday was selling regular for $3.059 a gallon.

CALIFORNIA WORSE

Three-dollar-a-gallon gasoline won't stop people from driving, but "it puts gasoline prices back on the front burner" for consumers, Green said. "As it goes up around $3 a gallon, more people will move down from premium to mid-grade and from mid-grade to regular, and it becomes a target of complaints."

At about $3 a gallon the average price for regular in Honolulu was well below yesterday's California average of $3.338 a gallon, according to AAA. Hawai'i historically has had the highest pump prices in the nation, which has been a sore point among consumers and lawmakers for dec-ades.

Just how much money oil companies make in Hawai'i remains a mystery. That could change under a law passed last year that promises to make oil and gasoline cost and pricing data available to the state Public Utilities Commission and ultimately the public.

At a Capitol briefing yesterday, PUC Chairman Carlito Caliboso said that program could be up and running by year's end, if lawmakers follow through with plans to provide the agency with added $1.2 million to run the program. At the same time, the PUC is asking lawmakers to allow the agency to keep confidential details about transactions for individual oil companies.

State Sen. Ron Menor, D-17th (Mililani, Waipi'o), who chaired yesterday's briefing, said the public has a right to know such details.

"The bottom line — collect it, collect it within a specified time period and make it public so we can all analyze the industry," he said.

Reach Sean Hao at shao@honoluluadvertiser.com and Curtis Lum at culum@honoluluadvertiser.com.