- The Washington Times - Monday, April 3, 2006

Washington-area motorists are paying an average of 7 cents more for a gallon of gasoline this week as crude oil prices yesterday touched their highest levels since Feb. 1.

A gallon of regular gas in the metropolitan area cost an average of $2.63 yesterday compared with $2.56 last week and $2.27 a month ago, AAA Mid-Atlantic reported.

“Frankly, we’re perplexed,” AAA Mid-Atlantic spokesman Lon Anderson said. “You’d like to see prices about this time of the year fairly low in anticipation of the summer cost increases. Unfortunately, they’re already in the stratosphere and still headed north.”

The average price of gas nationwide jumped 8 cents last week to $2.58 per gallon.

Customers at a Shell gas station on Duke Street in Alexandria yesterday were feeling the pinch.

“We feel like we’re really being gouged,” said Nelson Johnson, 45, who was racking up a $40 tab refueling his Honda Accord. Mr. Johnson, of Fairfax, owns three cars and drives frequently on his job as a computer consultant. To save money, he usually buys gas in Woodbridge, where it costs about 10 cents less, on his way home from Richmond.

“You’ve got to shop with your feet,” he said.

Analysts attributed the latest price rise to several factors, including mild temperatures and the onset of the summer driving season, which typically starts in March. The seasonal spike in demand was accompanied this year by the phaseout of a common gasoline additive in favor of cleaner-burning ethanol, causing confusion on the spot market, said Angela Veitch, a statistician for the Energy Information Administration (EIA).

A barrel of light sweet crude for May delivery gained 11 cents yesterday to close at $66.74 on the New York Mercantile Exchange. Earlier in the day, the price peaked at $67.90 — a two-month high. Unleaded gasoline for May delivery fell 2.11 cents to $1.8632 a gallon.

“Spot prices are very confused with the changes with ethanol coming up, and the relationships are skewed and confused. Traders basically don’t want to make the first move toward trading on ethanol inclusion on the market because of the time frame,” said Ms. Veitch, who noted that new environmental regulations specify when the methyl tertiary-butyl ether additive must be phased out but not when ethanol must be phased in.

On the positive side, she added, two major refineries are expected to come back on line this month after recovering from the Gulf Coast hurricanes last summer. Together, they represent 585,000 barrels a day of production capacity.

There will be no shortage of customers. For Chuck Martinez, a real estate agent who must pay for his own gas, cutting down on driving is not an option.

“It’s painful, but not really painful enough to send you scrambling” for better prices, said Mr. Martinez, 38, who lives in Silver Spring. “I just hope they don’t go up much more.”

Christie Palmer, a registered nurse in Alexandria, shops around when she can. “I just hope what we’re seeing is what it really costs and not just artificially high,” she said.

The EIA expects gas prices to continue to climb into the summer.

“There may be a lot of bouncing around in all of this, but over the next two months we think all of it will aggregate into a general trend upwards,” Ms. Veitch said.


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