Gas prices hit record high
By Greg Wiles
Advertiser Staff Writer
By Greg Wiles
Hawai'i's average gasoline price jumped to a record high this week, surpassing a mark set 31 months ago and increasing the possibility the statewide price will break through the $4 level soon.
The price of a gallon of regular rose 2.3 cents to $3.697 on Thursday, and diesel fuel also reached a new high with a statewide average price of $4.261.
The new gasoline price eclipses the old mark of about $3.684 a gallon, set in September 2005 after refineries shut down in the wake of hurricanes Katrina and Rita, according to data from the AAA's Daily Fuel Gauge Web site. The new high also comes just after the average price for a gallon of regular reached $4 a gallon Wednesday in Wailuku, a new high for Maui.
"I hardly drive now," said Carson Neves, a 21-year-old Kane'ohe resident who limits his trips into Honolulu because of prices and tries to find the cheapest gasoline when he needs fuel. The $5 fuel-ups he puts into his 2001 Nissan Sentra don't give him much these days.
"I just put in $5 the other day and it didn't reach a quarter of a tank," said Neves, who is in between jobs and tries to save money by sharing rides with friends.
Prices are tracking the rise of crude oil, which cracked the $100 mark in mid-February and reached a high of $110.87 earlier this week. Nationally, gasoline prices are reaching record levels and all three local markets tracked by the AAA have been increasing. More and more people are talking about $4-a-gallon gasoline soon becoming a reality nationwide, just as it has for Maui residents.
The previous statewide record of $3.684 was set on Sept. 18, 2005, because of gasoline shortages in the wake of hurricanes Katrina and Rita. At the time, the state was under a gas-cap law that set maximum wholesale prices based on prices in Los Angeles, the Gulf Coast and New York.
OVER A BARREL
The current situation is different because the state no longer has the gas cap law and because gasoline is plentiful compared to September 2005. But the market has changed and crude oil prices now have a greater influence over prices at the pump.
Whereas there were questions just two months ago if statewide gasoline prices would hit $4 a gallon, that's less the case now, said oil industry consultant David Hackett, head of Stillwater Associates in Irvine, Calif.
"It will get to $4 if crude oil keeps going up," said Hackett, noting it takes six weeks or so for crude oil price changes to ripple through to the gas pump.
A barrel of West Texas Intermediate crude oil traded in the $50 to $60 range on the New York Mercantile Exchange in the summer of 2005. Since mid-February it has traded in the $80 to $110 range, according to Bloomberg L.P. data.
It remains to be seen how much more prices will rise in Hawai'i as the higher crude prices work their way through to consumers. Hackett said prices generally rise more slowly in Hawai'i because of consumer resistance to price hikes, but also come down more slowly after crude oil prices recede.
Statewide gasoline prices for regular have risen by about 67 cents in the past year and Hawai'i's average gallon of diesel fuel has gone up 76 cents in the past 12 months to a record $4.261.
Wailuku has the highest price of the three markets tracked by the AAA, with a gallon costing $4.004 Thursday. It was the first city or county in the nation to hit $4 a gallon, according to the AAA.
ON LANA'I, IT'S $4.71
But that's not the costliest gasoline in the state. Oil Price Information Service, the data provider used by AAA, doesn't track prices on Kaua'i, Moloka'i or Lana'i.
Yesterday, Lanai City Service reported selling regular for $4.71 a gallon, while Rawlins Chevron Service in Kaunakakai, Moloka'i, said its regular was going for $4.36.
The Kukui Grove Self Service station outside of Lihu'e reported regular at $3.799 a gallon.
In Honolulu, the average price for regular was nearing its record, having risen to just 0.002 cents beneath it. The AAA reported the average price was $3.592 for O'ahu drivers.
Hilo's price was higher, but not as close to a new high. Its $3.705 average was less than the $3.773 high reached in September 2005.
The automobile club's data shows Hawai'i's statewide average is still lower than California's, which leads the nation with an average regular price of $3.767.
That's little solace to Neves, who thinks twice about driving to Honolulu, given his limited gasoline budget.
"I don't leave (Kane'ohe) town unless I have more money."
Reach Greg Wiles at email@example.com.