MOTORISTS get surprise at gas pump
Saturday, August 25th 2001, 12:00 am
By: News On 6
TULSA, Okla. (AP) _ What a difference a month can make.
Oklahoma motorists were enjoying some of the lowest gasoline prices in the nation last month.
But some of those same motorists received a shock on Friday when many of the state's gas stations raised the price of gasoline a whopping 20 cents to $1.69 a gallon.
Retailers in Tulsa had charged $1.39 as recently as Monday.
State pump prices are reacting to, among other things, the closing of Citgo Petroleum Corp.'s Lemont, Ill., refinery, which supplies fuel to several markets in the Midwest, including Chicago, industry analysts said.
The pipeline system used to deliver fuel to Chicago runs through Tulsa. When supplies in the Chicago area shrink, supplies from other markets, including Tulsa, are rerouted to the higher-priced Chicago market.
``Gasoline is taking off and it's definitely due to the Chicago issue,'' said Ed Silliere, vice president of risk management at Energy Merchant LLC in New York.
The refinery shutdown and a slowdown in refining activity, the result of seasonal maintenance, have combined to tighten supplies, AAA-Oklahoma reported.
Add those factors to an expected increase in demand during the upcoming Labor Day weekend and a cut in oil production by the Organization of Petroleum Exporting Countries starting Sept. 1, and the effect is higher prices at the pump.
In Tulsa, which uses a special grade of clean-burning fuel, the average wholesale price of regular unleaded skyrocketed 11 cents Friday to a closing price of $1.59 a gallon, 10 cents below the dominant retail price in Tulsa.
Nationwide, pump prices are averaging $1.44 a gallon, up from $1.40 a month ago, according to AAA. The average retail price in Oklahoma is $1.41, up from $1.23 a month ago.
Motorists in Dallas are paying, on average, $1.35 for a gallon of regular unleaded, while Kansas City pump prices are averaging $1.51 a gallon.
In May, pump prices in Tulsa soared to $1.69 before plummeting to $1.16 in mid-July. At that time last month, Tulsa motorists were paying the lowest price in the nation for a gallon of gasoline, according to the Lundberg Survey.
U.S. gasoline supplies last week dropped 2.5 million barrels, according to data released Wednesday by the Department of Energy. U.S. oil stocks dropped 5.3 million barrels.
Despite a struggling economy, AAA expects travel over the Labor Day holiday to exceed last year's holiday travel.
According to a AAA survey, 33.2 million people will travel 50 miles or more over the Labor Day weekend, up from 32.6 million last year. More than 27 million will travel via motor vehicle.