News Column

Gas Prices Spike Amid War Fears

August 29, 2013

Susan Hylton

gas prices

The chaos and potential for military action in Syria is pushing gasoline prices upward in Tulsa and across the country, an AAA Oklahoma spokesman said Wednesday.

QuikTrip Corp., the largest gasoline retailer in the area, raised its retail price for regular unleaded to $3.39 per gallon from $3.23 on Tuesday. The current price is still 30 cents cheaper than it was one year ago.

Meanwhile, the citywide average rose 5 cents to about $3.42 per gallon.

"Look for prices to continue to rise," AAA Oklahoma spokesman Chuck Mai said in an email response to the Tulsa World, "especially if we commence to attack Syrian installations."

The civil war in Syria -- and the Syrian government's alleged use of chemical weapons -- may provoke a U.N. or U.S. military response.

Crude oil futures closed at $110.10 a barrel Wednesday, the highest settlement since May 3, 2011, after the price peaked above $112 during trading on the New York Mercantile Exchange.

The all-time high for West Texas Intermediate crude oil futures was $147 in July 2008.

Mai said oil prices reflect not only what is happening but also a "psychological fear" of what might occur in the Middle East, especially if action is taken against Syria and oil-producing nations such as Iran respond.

"That would throw the area into a wild state of confusion where oil and gas production would no doubt be curtailed or shut down completely," Mai said. "Exports out of the Mideast would suffer dramatically if things get too hostile."

Currently about 45 percent of the oil used to make gasoline at U.S. refineries comes from foreign sources, including Canada, the Mideast and Mexico.

"There was a time when 65 percent of the oil we used to refine gas was imported from other countries," Mai said. "Unfortunately for the motorist, the price of oil determines the price at the pump."

The state average gasoline price is around $3.46 compared to the national average of $3.55, which is actually down from July 22 when the national average was $3.67.

"The national average moves quite slowly because of the 120,000 gas stations that are surveyed," Mai said.

The national average includes the most expensive prices at the pump in Hawaii, at $4.33, and the lowest in South Carolina, at $3.25.

Mai said there are about 10 states that have lower statewide gasoline price averages than Oklahoma.

Tulsa is averaging around $3.42, 7 cents lower than Oklahoma City's average of $3.49, said Mai, who noted that the two cities used to be about even, but Oklahoma City has been nudging higher in recent years.

"It's basically street corner competition," he said. "In Tulsa, QuikTrip plays the tune everybody dances to, and in Oklahoma City it's 7-Eleven. It's all about market share and profits."

Tulsa's all-time high was $3.93 a gallon on July 18, 2008.

Tulsa gasoline prices

Dollars per gallon

Wednesday: $3.39*

Previous day: $3.23

Two months ago: $3.09

Three months ago: $3.69

Year ago: $3.69

Record high: $3.93**

--Common observed price for regular unleaded.

--On July 18, 2008.

Sources: AAA-Oklahoma, Tulsa World staff.

Susan Hylton 918-581-8381

susan.hylton@tulsaworld.com

___

(c)2013 Tulsa World (Tulsa, Okla.)

Visit Tulsa World (Tulsa, Okla.) at www.tulsaworld.com

Distributed by MCT Information Services




For more stories covering business, please see HispanicBusiness' Business Channel



Source: Copyright Tulsa World (OK) 2013