- The Washington Times - Tuesday, June 21, 2005

Rising gasoline prices are affecting the Washington area’s driving habits, from drivers shopping around for the best price to vacationers cutting back on summer travel.

“I’m riding a motorcycle right now. That helps out a lot,” said Kevin Johnson of Baltimore who was pumping gas at the Citgo station at New York Avenue and Bladensburg Road in Northeast yesterday afternoon. “I’m forced to ride my bike,” he said. “I’ll be glad when [gas prices] go down.”

Station manager Ray Pirzadeh said the price for regular, self-serve gasoline had jumped to $2.21, an increase of 6 or 7 cents this week.

Varsylvia James, of the District, was buying gas there even though she’s a price-conscious shopper.

“If I can get Costco gas that gives me the best bang for the buck, but there are only two Costcos and there’s no way I can get there soon,” Ms. James said.

So she was buying enough gas at Citgo to get her to Springfield, where she works and where gas is cheaper.

The price of gasoline has risen over the past week as crude oil reached a record high of $59.70 a barrel Monday, according to AAA Mid-Atlantic.

Some area stations reported large increases.

“This week there was a 4 cent to 5 cent increase. We used to have a lot of customers. Since they increase it, sales have been going down,” said Daba Gezehagne, manager of a Hess station at Montana and West Virginia avenues in Northeast.

Two stations in the Four Corners area of Silver Spring raised prices 4 cents between Monday and yesterday.

Although the price of gasoline is still lower than the record reached in April, it costs about 20 cents more than it did last year.

Oil for July delivery slipped yesterday to $58.90 a barrel from Monday’s record, but the price has risen 57 percent this past year. When adjusted for inflation, the price is still much lower than the $90 a barrel reached in 1980, according to Scotsman.com.

Industry analysts do not see prices coming down in the foreseeable future.

The increases are affecting driving habits, with sales of big SUVs declining sharply, said John Felmy, chief economist at the American Petroleum Institute.

Thomascine Douglas of Hyattsville said she has been curtailing her driving because of the higher cost.

“I go where I have to go. I don’t go just riding,” Ms. Douglas said. “It does impact my vacation plans. I’m going to stay within a 50-mile radius, maybe Ocean City.”

Ms. James also said she was going to “stay local” this summer, driving no further than Myrtle Beach, S.C.

The rising cost of oil and gasoline affect much more than pump prices for drivers.

“There’s virtually no segment of the economy that’s not affected by higher fuel prices,” said Lon Anderson, spokesman for AAA Mid-Atlantic.

“Few forces are more inflationary than fuel prices,” he said.

“Obviously, the administration has to be very concerned when fuel costs are in the stratosphere, because all products and shipping are affected. Food, clothing, etc. all have fuel costs built in,” Mr. Anderson said. Since service people such as plumbers and electricians have to pay more for fuel, they charge customers more.

Governments also have to pay more for fuel, which affects their budgets and could mean reductions in services or increased taxes, he said.

Factors contributing to the rise in fuel prices are competition in the world market, particularly from China; instability in major suppliers such as Iraq, Russia, Venezuela and Norway; and the lack of refining capacity in the United States, according to industry analysts. No refineries have been built in the United States since 1976.

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