- The Washington Times - Friday, February 7, 2003

The triple threat of the Venezuelan oil crisis, cold weather and fear of a war with Iraq has pushed the average price of gasoline to $1.53 a gallon, 41 cents higher than a year ago.
"It's a triple witching," said John C. Felmy, chief economist for the American Petroleum Institute, an industry trade group.
Prices have been creeping up for at least two weeks, according to the U.S. Energy Information Administration, an independent federal agency that monitors gas prices. The average price for regular unleaded was $1.46 during the week of Jan. 20, the agency said.
In the Washington area, the average price is $1.56, according to the Mid-Atlantic chapter of AAA, the motorists' advocacy group formerly known as the American Automobile Association.
The highest price on record, $1.72 a gallon, was recorded May 18, 2001, the association said.
A two-month strike in Venezuela has cut exports from the South American country, which supplies the United States with 9 percent of its crude oil annually, Mr. Felmy said. Venezuela is the second-largest supplier of oil to the United States, after Saudi Arabia.
Workers at the state-owned Venezuelan oil company Petroleos de Venezuela began the strike in early December to protest the leftist President Hugo Chavez.
Since the walkout began, U.S. refiners have reduced production as the lack of supply pushes crude oil prices close to their highest level in two years. Federal research indicates crude oil input into U.S. refineries fell 1.2 million barrels per day in the past three weeks.
The United States consumes roughly 20 million barrels of oil daily.
Compounding the problem is an Arctic blast in the Northeast that has increased demand for heating oil, and oil industry jitters about a war with Iraq, which could disrupt the flow of oil exports from the Middle East, according to analysts.
"When you put all those things together, it's the old case of supply and demand, and you have no reserves right now," said Roy Littlefield, executive vice president of Service Station Dealers of America and Allied Trades, a trade group for gas station owners and operators.
Some local gas station dealers said business has dropped off in the past two weeks.
Paul Fiore, proprietor of a Shell station in Laurel who has raised the price at his pumps three times in 10 days, said business has dipped. He sold regular unleaded gasoline for $1.53 yesterday, up 10 cents from late January.
Gas station dealers often raise the price at the pump as a last resort, Mr. Littlefield said.
Oil companies raise the price they charge the dealers, but the dealers try to delay passing the extra costs onto their customers for as long as possible to remain competitive with nearby stations, he said.
Some dealers have profit margins as small as 2 or 3 cents a gallon.
"I'm making the same amount off gasoline that I did 30 years ago," Mr. Fiore said.
Mr. Felmy said the conflict with Iraq makes it impossible to forecast the future when it comes to oil prices.
However, the Venezuelan strike is fading, which could relieve some of the pressure, he said.
Consumers who have been hit in the wallet by this latest gas-price increase should "shop with their steering wheel," said AAA spokesman Lon Anderson.
Some independent stations charge between 10 cents and 12 cents less than major stations, he said.
Consumers also can try to get more mileage from each gallon of gasoline by avoiding accelerating and braking quickly, Mr. Anderson said. Motorists also should maintain a speed of about 55 miles per hour, make sure their tires are inflated properly and keep their car tuned up, he said.

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