No gas relief

by Susan Gibbs Record Reporter
Published: June 12, 2008

Nolan Lavoie of Dyke was staring hard at an Exxon pump on Route 29 in Ruckersville Monday, watching the dollars it was costing him to fill his Ford F150 add up.
“Even if I wanted to sell (my truck), I probably couldn’t,” he said, as the numbers kept on turning.
On Tuesday, AAA reported the national average price for a gallon of regular unleaded gasoline rose to $4.043, up 20 cents from Monday’s high of $4.023.
And along with consumers, some pumps can’t handle the increase.
Rising gas prices have Governor Tim Kaine making allowances for pumps that can’t keep up.
“About 1,800 analog pumps in the state don’t go over $3.99 a gallon,” says Gordon Hickey, speaking for Governor Kaine. “Retailers (with such equipment) can mark their gas at half price at the pump.”
In other words, if the pump reads $2.12 a gallon, the charge per gallon is really $4.24, and that’s the price consumers will have to come up with when they reach for their wallets.
This pricing method, called half-pricing, was last used during fuel price spikes after Hurricanes Katrina and Rita in 2005.
Now, with the price of gas in the United States averaging more than $4 a gallon and rising, recent demand for kits to update or retrofit analog pumps has created a backlog. Many stations are unable to acquire the kits and get them installed in a timely manner.
So on May 30, Governor Kaine issued an Executive Order giving them until September 30, 2008, to do so.
This Order grants a temporary waiver to those gasoline retailers who, due to the backlog, cannot comply with the Virginia law that requires them to list the per gallon price of petroleum products.
And, it applies only to retailers whose pumps are mechanically unable to display accurately the current price of petroleum products due to the age and design of the pump.

Those retailers with older, analog pumps that say, for example, that gas is $2.12 a gallon, are required to post an explanation indicating that the total sale price will be double that indicated on the register head. And, they must have placed an order for an upgrade that will allow the pump to accurately reflect the price of gas to qualify for the waiver.
It would seem that the latter requirement is a clear sign that prices are not expected to decline - not that some Greene County residents are surprised.
Lavoie says he sees the rising prices of petroleum products as “growing pains” the country will have to endure.
Those growing pains will be “worth it,” Lavoie adds, “if it means we’ll become less dependent on Middle Eastern oil. With gas prices going up, people will start being more fuel-efficient; they’ll go to solar energy and other alternate fuels.”
Eric Hopwood of Barboursville, who was found filling up his Chevrolet Trailblazer, agrees.
“We need to get on alternative fuels” and away from the Middle Eastern countries,” Hopwood says.
But until those alternative fuels become available, the country remains dependent on gasoline - the main product refined from crude oil.
And those prices have been rising by leaps and bounds.
The price of crude oil was up to $140 a barrel last week, before falling back to $134 Monday.
Last year, according to the United States Government’s Energy Information Administration (EIA), the price of crude oil averaged about $68 per barrel. From 2000 to 2007 the average crude oil price was about $39 per barrel.
Strong and increasing demand for gasoline and other petroleum products in the United States and the rest of the world is exerting intense pressure on available supplies. Other factors contributing to higher crude oil prices include political events and conflicts in some major oil producing regions, as well as other factors such as the declining value of the dollar - the currency at which crude oil is traded globally.

But even when crude oil prices are stable, gasoline prices fluctuate due to seasonal demand and local retail station competition.
According to the EIA, retail prices for gasoline tend to gradually rise in the spring and peak in late summer when people drive more, and then drop in the winter, Good weather and vacations cause the country’s summer gasoline demand to average about 5 percent higher that during the rest of the year. If crude oil prices do not change, gasoline prices typically increase by 10-20 cents from January to the summer.
But it’s not just the price of gas that’s going to be rising.
On the heels of the rising cost of gasoline will come increased costs for food and anything else that needs to be transported, experts say.
Also on the heels of the rising cost of gasoline, reports say, American consumers are scaling down their choice of vehicles, and buying smaller, more fuel efficient vehicles.
Although Lavoie is not one of them.
“I’m going to drive my truck until the wheels fall off,” he said, gazing at the pump that was telling him he owed $66.05 for three-quarters of a tank.”