Gas prices soar as Memorial Day nears
As rising gas prices set records across California, Truckee gas customers are hit especially hard with rates that hover almost 20 cents above the state average.
Some Truckee gas stations report customers buying only enough gas to drive to Reno, where gas averages $2.33 a gallon for regular unleaded, as opposed to paying the $2.55-per-gallon average in Truckee.
“People used to fill up, but now they put in a couple bucks to go fill up in Reno,” said Truckee Texaco employee Gary Barnhart. “Same customers, but they only pay a couple bucks now.”
Individual consumers and gas-reliant local businesses are hurt by the increased costs, but service stations also often find the bulk-fuel rate increases cutting into their profits, as they only pass on certain increases to the public.
“We’ll pass an increase along when we have to, but we don’t pass every increase along,” said Rob McAuliffe, manager of Truckee 76.
While the cost of transporting fuel into Truckee drives up the local price, nationwide rates have been climbing mostly because of a simple imbalance in supply and demand, McAuliffe said.
“I hear the same thing that everyone else hears – that there is more demand than there is supply,” he said.
Gasoline prices across the country climbed more than 14 cents in the past two weeks and show no signs of slowing their climb, an industry analyst said. The California average price stands at $2.36 a gallon for regular unleaded, according to AAA data, a 19 cent jump from a month ago.
“So far the higher prices have not chased demand away, and our biggest demand season is yet to come,” Trilby Lundberg, who publishes the bi-weekly Lundberg survey, said. “There is no evidence yet that gasoline prices are peaking. They may soon, but there’s no evidence that that is occurring yet.”
Lundberg predicted that oil supply will rise whether or not OPEC agrees to officially raise its quota at its Beirut meeting on June 3. But she said oil price drops won’t necessarily result in lower U.S. gas prices. She said the reductions would be at least partially offset by increased demand from economic growth, environmental regulations, and an increase in driving during the summer months.
The average price of gasoline has broken all-time record highs for three months straight, although the average price remains lower than the peak gas price in March 1981 when adjusted for inflation, Lundberg said. That price, adjusted for today’s dollars, was $2.91 for all grades combined, she said.
But the record prices don’t seem to be slowing summer travel plans. A new AAA report shows that 3.9 million Californians are expected to travel 50 miles or more by car over Memorial Day weekend, an increase of 2.7 percent over last year.
“Record gas prices aren’t stopping people from venturing out on the road this holiday,” said AAA spokeswoman Cynthia Harris. “Despite the fact that California’s gas prices have increased more than 50 cents compared to last year, a growing number of travelers will hit the highways.”
Nationwide, AAA estimates nearly 36.9 million people will travel over the Memorial Day weekend, an increase of 3.6 percent from last year. Nearly 31 million will travel by car, AAA said. The projections are based on a national telephone survey of 1,300 adults conducted by the Travel Industry Association.
“This strong holiday forecast comes at a time when both lingering concerns about the economy and the impact of high fuel prices are still affecting consumers,” Harris said. “But there is a pent up desire among travelers to return to their traveling ways of the past.”
The Associated Press contributed to this report
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