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Gas prices jump to record high

By: Dave Flessner
(Contact)

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Gregg Laskoski

Chattanooga gas prices jumped Monday to an all-time high, tying the record price set in fall 2005, according to AAA survey of area service stations.

The auto club survey found the average price of a gallon of regular gasoline in Chattanooga rose by more than 16 cents in the past month to more than $3.07 per gallon. Prices at the pump are up 88 cents a gallon from a year ago in Chattanooga, raising the cost of filling up a typical vehicle tank by more than $15 from what motorists paid last winter.

“It’s ridiculous,” said Scott Howard, a Jasper, Tenn., motorist who usually commutes to Chattanooga in his Chevrolet 1500 pickup truck four or five times a week. “I think the government should step in and do something about it. Enough is enough.”

Mr. Howard and his wife are having to spend an average of $120 a week on gasoline, or $35 more a week than they did a year ago.

The higher prices have not reduced consumption, which is increasing slightly despite the softening economy and higher prices.

Dr. Ziad Keilany, an economics professor at the University of Tennessee at Chattanooga and a former adviser to OPEC, said the rising demand “is somewhat puzzling” in the face of rising prices and is much different than when prices jumped to record highs in the 1970s.

“The price increases this time have been more gradual and people are getting used to paying these prices,” Dr. Keilany said.

“There is also a growing demand for oil around the globe with the continued economic growth in China, India and other developing countries,” he said.

Ruby Suttles, a Chattanooga motorist who said she spends more than $60 a week filling up her car, said she has little choice but to bear the pain at the pump.

“I don’t think it’s fair, but I guess I have to deal with it like everybody else,” she said Monday while buying gas in Chattanooga.

Gregg Laskoski, public and government relations managing director for AAA in Georgia, said gas prices are likely to go even higher this spring.

“We typically see fuel prices go up like clockwork from March through May because of the conversion to the summer-blended fuel,” he said.

Mr. Laskoski said refineries “are really hard pressed” to meet the demand for both heating oil in the Northeast and summer-blended gasoline, which must be sold in most major markets from May through September. The Energy Department’s latest forecast calls for gas prices to peak near $3.40 a gallon this spring.

Tennessee gas prices have risen by an average of 16 cents per gallon in the past two weeks as the price of oil has neared or surpassed the $100-per-barrel level on the New York Mercantile Exchange.

Nationwide, the average U.S. price of a gallon of regular fuel climbed to nearly $3.14 a gallon, according to AAA.

Light, sweet crude for April delivery gained 42 cents to settle at $99.23 a barrel in trading Monday on the New York Mercantile Exchange. It climbed as high as $99.70 a barrel earlier on supply concerns heightened by a Turkish military incursion into northern Iraq and warnings by Iran against further international sanctions.

The Associated Press contributed to this story.

GAS FAST FACTS

* The average price of a gallon of gas in Chattanooga reached $3.07.3 Monday, trying the record high set on Sept. 5, 2005.

* Chattanooga gas prices were 6.4 cents per gallon less than the U.S. average.

* Gas prices are up 16.1 cents in the past month and 88 cents from a year ago in Chattanooga.

* The cost of filling an 18-gallon gas tank Monday, $55.31, is up $15.84 from a year ago.

Source: AAA Daily Fuel Gauge

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