Gas prices begin to edge back up
Spokeswoman for AAA Utah, Rolayne Fairclough, said the increasing price is due to supply and demand. She said demand for gas is low, which is forcing refiners to “curtail production (of gasoline) so there isn’t a lot of product as there use to be so they’re using up reserves.”
Low demand is also affecting the oil industry. The Organization of the Petroleum Exporting Countries (OPEC) is also cutting production, Fairclough said. If demand for gasoline is low, refiners don’t need to buy as much oil which leads to low demand for oil, she said.
“The demand is so low you can see the barrel price decreasing, as well,” she said.
Fairclough says demand is down because of the economic downturn. The downturn has caused people to buy less leading to a decline in shipments made, she said. With high unemployment rates, she said, people aren’t having a source of income, deterring them from paying for gasoline.
The Bureau of Labor Statistics recorded the unemployment rate at 7.6 percent in January in the United States.
Cache Junction resident, Weston Evans, has a job in Logan. He said he bought a 1992 Chevy Lumina to replace his 2004 Dodge Ram as his main vehicle to save money on gas. He said his Lumina gets about 30 miles per gallon while his Dodge gets about 15.
“Before, I didn’t want to visit my dad (who lives in Brigham City) so much,” Evans said.
Sophomore Chelsey Randall, majoring in family and consumer sciences education, said she use to drive down to her home in St. George once a month. Nowadays, she said she only visits home once every three months.
“Even now, it costs me about $110 to and back,” Randall said, who drives a Ford Expedition that gets about 14 gallons per mile. “And I can’t afford that.”
Crude oil opened Sunday in the stock market at $39.90 per barrel. Each barrel is 42 gallons and, when refined, yields about 19.6 gallons of gasoline and 9.21 gallons of diesel fuel, according to the Energy Information Administration Web site. With the leftovers in the barrel, distillate fuel oil, residual fuel oil, jet fuel and other products are produced, it stated.
On top of the Federal requirement of a .1840-cent tax on gasoline for all states, the state of Utah taxes .245 cents, the Web site states. New York, Hawaii and California have the highest total tax at .629, .601 and .60, respectively.
According to the Web site, Alaska has the highest average price for regular at $2.53. Hawaii has the second highest with $2.43 and California comes in third with $2.28. The national average for regular gasoline was $1.91 Sunday.
With hybrid cars looming over the horizon, Fairclough said hybrid cars will push the demand for gas further down and it will also stretch each gallon per mile. However, she said she doesn’t know how it will affect gas prices.