Daily Nonpareil, Council Bluffs, IA
05-05-07
Three-dollar gas returns; there's no break in sight
PHIL ROONEY, Staff Writer
Faster than a Corvette cruising down West Broadway, gas prices continue to
head toward record highs.
According to the online AAA Fuel Gauge Report, the national average price for a
gallon of regular unleaded has topped $3 per gallon.
Fires at refineries are being blamed for some of the price jump, but talk of $4-pergallon gas is replacing the weather as the seasonal topic.
The approaching summer travel season may arrive with prices topping the Labor
Day 2005 record national average of nearly $3.06 per gallon of regular unleaded.
Friday's price already was within a nickel of that mark.
The unleaded ethanol blend was nearing $3 per gallon at many stations in the
metro area.
Iowa State University economist David Swenson said crude oil supplies are
adequate and consumers should have been getting a break.
"It's less of a world supply and global issues problem and more of a problem with
the refineries," he said, adding that many refineries are down for maintenance
and others are having unplanned maintenance.
The recent development of empty pipelines hasn't happened for a while in the
Midwest, and that doesn't happen very often, Swenson said. Current prices are
about 15 cents per gallon above the year's peak price as forecast by the Energy
Department.
Price records should be adjusted for inflation, but he would consider $3.12 per
gallon a legitimate record high average. Still, he's looking for prices to moderate.
"We would expect the supply to start chasing the demand," Swenson said.
The rising prices may be starting to hurt the average family, a group that
basically has experienced flat wages for nearly two years, he said.
"In the short run it's always harmful to your local, domestic economy."
Swenson said he's not convinced that prices will reach $4 per gallon, because all
of the indicators indicate there is adequate supply and refining capacity to meet
the needs of consumers.
"I'm just going to wait and see," he said. "I've just got to think this is more of a
glitch."