Gas Hike Hits California Hard
CYNTHIA L. WEBB
Apr. 01, 1999
LOS ANGELES (AP) _ In car-crazy California, a dramatic hike in gas prices _ close to $2 a gallon in some spots _ is stirring up frustration and resentment reminiscent of the 1970s energy crisis.
``It angers me,'' said Robert Sumber, 39, who was filling up a car instead of his gas-guzzling pickup truck on Thursday to try to save money. ``You need to drive here. What can you do?''
Prices everywhere in the country have jumped with OPEC announcing production cuts to boost sagging oil prices, but California has been hit especially hard.
Fires at two refineries in Northern California cut into supplies, and the state's decision to remove a chemical additive from gasoline helped boost the cost, analysts say.
Some consumer-rights activists say it's really a case of price-gouging.
Whatever the causes, the result is clear: Californians are paying an average of $1.46 for a gallon of regular gasoline, up from $1.12 a gallon just a month ago, said Aileen Bohn, a spokeswoman for the Washington-based Energy Information Administration.
Nationwide, the average is $1.08 per gallon.
This is especially bad news for drivers in a state known as much for its cars as its sun.
``I can't afford these prices when every dollar counts,'' said Kristina Whelan, a 19-year-old Spanish literature major at the University of California, Los Angeles.
A television station has broadcast a hot line for cheap gas, and some stations are advertising the best deals in town during newscasts.
The anger is resonating on the Internet, too. A chain e-mail making the rounds Thursday called on Californians not to buy gas on April 30 to show their outrage.
``Let's have a GAS OUT!'' it read.
A community group planned a news conference Friday to denounce what it called price-gouging and to ask the government to intervene.
``Some of the parents are expressing the anger because they are now having to decide, make a choice between purchasing gasoline and milk,'' said the Rev. Lowe Barry, one of the activists. ``Gas is nearly $2 a gallon and milk is at least $3.50 a gallon.''
Steve Asmann, owner of two Exxon stations in Pleasanton, a city of 60,000 in Northern California, raised his prices an average of 12 cents a gallon Wednesday and was selling his premium for $1.99 and nine-tenths.
``I've ordered the number 2 for my signs,'' he said. ``I never thought I'd have to use them, but now I don't know.''
Six weeks ago, it was possible to find 99-cent gas in San Jose. With the hikes, some stations were selling gas for $1.61 a gallon.
``I think it will be a long time before we see 99-cent gas again,'' said Jerry Cummings, co-owner of a company that owns Rotten Robbie stations.
Oil industry analysts point to recent fires at two refineries in the state that limited production.
Another possible cause is Gov. Gray Davis' recent order to phase out the use of methyl tertiary butyl ether, or MTBE, an oxygenate added to gasoline to make it burn cleaner. Research has shown that the compound causes tumors in rats and may do so in humans.
Finding a replacement for MTBE _ which was thought to be necessary to help the state comply with clean-air laws _ could be costly.
Add a sizable state tax of 18 cents per gallon and a 7.25 percent sales tax, and California's gas is among the most expensive in the nation. Motorists everywhere pay 18.4 cents per gallon in federal taxes.
Relief may be in sight, however.
Oil companies are shoring up supplies by bringing in fuel from the oil-rich Gulf of Mexico and tankers near Los Angeles ``to take advantage of this price differential,'' Ms. Bohn said.
She couldn't specify when that might happen, however.