‘Perfect storm’ sends fuel prices skyward
by Joel Danoy
Oct 12, 2012 | 3358 views | 25 25 comments | 6 6 recommendations | email to a friend | print
Price crunch at the pumps
Yellow Cab owner Jay Akbari gets ready to gas up one of his fleet of cars at the Chevron station on 11th Street  on Wednesday, Oct.10.  Glenn Moore/Tracy Press
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Jay Akbari had a grimace on his face as he swiped his credit card at the gas pump to fill his taxi’s tank on Wednesday, Oct. 10.

The owner of Yellow Cab in Tracy winced even more as the pump numbers spun higher and higher at a rate of $4.69 a gallon.

His 2008 Dodge Caravan topped off at about $80, after prices for a regular gallon of gas have skyrocketed nearly 60 cents since Oct. 1 to

an average of $4.57 on Wednesday in the Tracy area and $4.64 in the state, according to GasBuddy.com.

The national average has held relatively steady during the same time at about $3.80 a gallon. On Thursday, Oct. 11, Tracy-area stations averaged $4.55 a gallon for regular gas, while the state hovered just above $4.65, GasBuddy.com states.

“My drivers and I, we are crying for our wallets when we have to fill up,” said Akbari, who employs 65 drivers from the East Bay to Modesto. “Everybody is hurting, because it caught us by surprise, because it’s like it happened overnight.”

Gregg Laskoski, senior petroleum analyst for GasBuddy.com, said Thursday that a “perfect storm” of events caused gas prices to spike in California but remain stable in other parts of the country.

On Oct. 1, states typically switch gas supplies from a summer blend to a winter blend, as manufacturers produce gas according to the season. California refineries take that summer blend and further refine it to meet the state-specific standard.

Diminished supply because of the changeover, combined with the recent shutdown of three refineries in California and a major pipeline from Kern County to Northern California, caused wholesalers, retailers and customers alike to pay higher prices.

“California is the only state in the country that has refineries that produce the special blend of gas that the state laws require,” Laskoski said. “When you have these refineries shut down their operation and the infrastructure to move the product is stressed, that’s going to affect prices. Wholesale prices, needless to say, went through the roof.”

Sen. Barbara Boxer (D-CA) wrote a letter Monday, Oct. 8, to U.S. Attorney General Eric Handler requesting that the Oil and Gas Price Fraud Working Group investigate the price surge in the state and determine whether “traders colluded to manipulate and drive up gas prices.”

Boxer went on to write that “Californians have too often been victimized as unscrupulous traders have created or taken advantage of supply disruptions to drive up energy costs.”

“We cannot allow market manipulation by those who would seek to profit off the pain of our families at the pump,” she wrote.

Laskoski said the state has already begun to mix the winter blend to alleviate pressure at the pump, and he expects gas prices in the state to “moderate downward over the next week,” but he said that won’t happen until retailers get returns on their current stock.

On Thursday, Tracy-area stations averaged $4.55 for a gallon of regular gas, while the state average hovered just above $4.65 and the national trend ran near $3.80 a gallon, GasBuddy.com states.

“They bought this gas a week ago at a higher price, so they’re going to sell it at that rate,” Laskoski said. “There is going to be some lag time, but it should get better soon.”

That’s good news for gas guzzlers such as Akbari and his taxi drivers.

He is providing some relief to his drivers by splitting gas costs, but he said the move makes him operate at a loss.

Drivers can average $50 to $100 a night depending on the day of the week and call volume.

Samey Rahgozar, a driver for Yellow Cab, said the gas assistance helps, but it’s still difficult to make ends meet.

Four hours into a 12-hour shift Wednesday, he had earned only $15 on two fares.

“I have to split that with gas, insurance, my other costs, so there is a big hole,” Rahgozar said. “Sometimes you make a little, but it’s hard, because it’s short trips.”

Rahgozar has adjusted his tactics and now stays in one spot until he gets a call. But that eliminates flag-downs by patrons and more potential revenue.

“I hope it gets better soon,” he said.

“(The price) needs to go as low as it can.”



Ten tips for fuel efficiency

1. Avoid high speeds

As speed increases, aerodynamic drag increases. Driving 62 mph as opposed to 75 mph will reduce fuel consumption by about 15 percent.

2. Do not accelerate or brake hard

Anticipating the traffic and applying slow, steady

acceleration and braking, may increase fuel economy by as much as 20 percent.

3. Keep tires properly inflated

Keep tire air pressure at the level recommended by the vehicle manufacturer. A single tire underinflated by 2 pounds per square inch increases fuel consumption by 1 percent.

4. Use air conditioning sparingly

When the air conditioner is on, it puts an extra load

on the engine and forces about 20 percent more fuel consumption.

5. Keep windows closed

Windows open, especially at highway speeds, increase drag and result in decreased fuel economy of up to 10 percent.

6. Service vehicle regularly

Proper maintenance avoids poor fuel economy related to dirty air filters, old spark plugs or low fluid levels.

7. Use cruise control

Maintaining a constant speed over long distances often saves gas.

8. Avoid heavy loads

Remove any sand bags used to gain extra traction during winter from the trunk in the spring, and pack lightly for long trips.

9. Avoid long idles

If you anticipate being stopped for more than a minute, shut off the car. Restarting the car uses less fuel than letting it idle for this time.

10. Purchase a fuel-efficient vehicle

When buying a new vehicle, examine its rated fuel efficiency. Usually, choosing a small vehicle with a manual transmission will provide better relative fuel economy.
Comments
(25)
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backinblack
|
October 15, 2012
Spike, By the way, would you mind explaining why housing prices being lower under Obama is a good thing which is what you seem to be implying? You must not own a home because most homeowners I know, myself being one, are glad prices are starting to go back up, we were also pretty upset when they dropped so precipitously.

The reason they dropped so far wasn't because of a normal cycle, which I believe most of us expect and take into consideration, it was due to the collapse of the market which was brought on by under qualified people being approved for loans which occurred due to laxed lending standards. The match which lit the fire? Refer to my prior comment. Oh wait, are you in the group who believe you have the right to home ownership whether you earned it or not. You know, things like busting a** at work, striving to become the best at your job so you can pretty much be assured of continuous work, sticking you neck out like Dale and opening your own business, never saying, gee I work hard enough already. I wonder.

dcose
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October 15, 2012
Would love to but I don't SpikeVFR wants more information in regard to anything other than Bush in the crosshairs.

With the amount of information already available, the politicians and upper management not held responsible at FANNIE & FREDDY, too big to fail banks, few liberals can tolerate something that is unflattering and in some cases, outright illegal, especially with the election coming up.
SpikeVFR
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October 16, 2012
wow, back, that is a LOT of assumptions, and nearly all of them untrue; actually upon further review each and every one of them is wrong

nice try, thanks for playing
dcose
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October 19, 2012
Called it
backinblack
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October 15, 2012
Spike, I just noticed your comment about the housing crisis. Interesting you don't bother with Clinton, Gore, and pretty much all Dems bragging about how great the economy was under Clinton, yet disregarding the fact it was largely based on the dotcom boom. You also seem to be unaware they weren't exactly sounding the alarm bells by telling people, whoa buddy, this thing isn't going to last.

Do you know at one point under Bush more black Americans owned homes than at any point in our history. He gets plenty of blame from people like you for the housing bubble and collapse, yet never get's any credit for the above mentioned fact. Speaking of facts, Bush doesn't really deserve any credit for the boom, collapse, or more blacks owning, that credit or should I say blame starts with Carter and the Community Reinvestment Act.

If you would like to learn more let me know as I can give you in-depth explanations of what causes prices to inflate, how people who can't afford homes end up being approved, supply & demand, etc. I'm sure Dale can add some additional insight so by the time we are both done you will realize your blame on the housing bubble/collapse is terribly misplaced.
backinblack
|
October 15, 2012
SpikeVFR, Granted my comment about Prius & Volt owners was a bit over the top but where exactly did I say anything about a persons political leanings, or how exactly is it relevant? You seem to be the one bringing political leanings into play. Go ahead and classify them as you see fit but I was simply referring to the save the planet crowd.

Also, you seem fairly knowledgeable about cars which means you should know there's a lot of people who can't truly afford the car or truck they own. Because they bought a vehicle in a certain price range doesn't necessarily mean they can afford gas, maintenance, etc. We humans make bad decisions all the time.
Ornley_Gumfudgen
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October 14, 2012
monsterdad3k

An when ya were gassin up in California did ya notice ya got worse mileage per gallon in California as opposed ta outside of California?

Our, especially formulated California gasoline apparently gives us less fuel efficiency than gasoline sold outside of California and at a higher price. Ain't that grand?
Ornley_Gumfudgen
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October 13, 2012
Surprized TP didn't list a number 11. "Re-elect Obama." :)

As ta no hit by AC in cars on engine efficiency whair th AC runs off electricity, an I ain't seen a compressor run of electricity yet unless it's an all electric car but I admit I ain't seen em all, th alternator that provides th electricity is attached ta th engine an when it's providin power ta a heavy load like an A/C system it does load th engine powerin th alternator. In fact ya can hear it when ya switch yer A/C on or see it with a volt meter attached ta yer battery. Admittedly it's not a 20% load but it does load th engine even if its all electric. Ethanol gives ya a similar loss in efficiency even though people thank it's cleanin up th atmosphere. Right, burn 20% more fuel because th fuel yer burnin ain't as efficient as straight gasoline an that's cleanin up th atmosphere.

Refineries are special in CA an are th only ones that can produce CA fuel. Gasoline is gasoline an all of it's made th same way. Th additives are added AFTER th refinin process. But hey, it sounds good when ya print it in an article.

CA's gasoline ain't all that special, just th people buyin it an thankin it is.
SpikeVFR
|
October 13, 2012
Toyota has been doing it for a while, since at least 2004. Although not on all models. Honda, BMW, and MB also have similar systems in place, as well as Porsche.
monsterdad3k
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October 14, 2012
On a trip to Colorado last summer my big pickup truck was getting better fuel efficiency driving at 75 MPH with the A/C running than it was driving at below 65 MPH with the A/C off. At least according to the on board computer system. And cruise control did help to keep the numbers consistent but that is only useful on open interstates and highways. Seriously considering the Porsche option!
backinblack
|
October 12, 2012
mrmnfallacy, Going by your poorly thought out comment I guess I better start by pointing out I do not own a SUV so don't assume I'm biased. Are you for real? What the hell does the type of vehicle have to do with the number of idiotic drivers running around? Last time I checked I see them driving all manner of vehicles. Are you some green nut who simply has something against SUV's, or is it any vehicle that doesn't plug into a socket to get it's go go juice?

Ego? Seems to me the people with ego's these days are the snide little twits who run around in a Prius or Volt. Hey look at me, I'm better than the rest of you because I'm saving the planet. Are you jealous of those who can afford $150 to filler up? You obviously suffer from some sort of complex. Dale's right, this isn't the U.S.S.R but maybe you can exercise your right to Life, Liberty, and The Pursuit of Happiness by purchasing a one way ticket to go see how Vladimir and his pals live.
SpikeVFR
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October 15, 2012
Anyone who can afford to buy a Volt or a new Prius can easily afford to pay $150 for a fill up. There are some pretty wealthy owners of both. And there is a fair amount of right wingers who buy Prii and Volts. It is a BIG fallacy that they are all tree huggers.
dcose
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October 12, 2012
Junk your property. Though close, this isn't the U.S.S.R.
mrmnfallacy
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October 12, 2012
...lets add to the list above. Junk all the full size SUVs we see these clowns driving all over town while rolling through stop signs, red lights, running over things at McDonald's drive-throughs, and then simply driving off as reported in paper the other day? How are those $150 fill ups working out for them? Doing whatever it takes to feed their fragile egos at any cost. Simply pathetic
dcose
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October 12, 2012
ChrisRoberts... The Joe Biden of the Tracy Press website, No Facts, No Problem... Just making scat up as I go.

The fact that gas has more than doubled from Bush under Obama doesn't register with you?

Under Clinton:

1992 $1.47

2000 $1.70

Under Bush

2001 $1.61

2008 $3.01

Under Obama

2009 $2.14

2012 $6.64 in CA

Just Awesome

http://www.davemanuel.com/2010/12/30/historical-gas-prices-in-the-united-states/

Are you happy with the price of housing under Obama ? You can thank Jimmy Carter & Bill Clinton for the Community Reinvestment Act. Both liberal Democrats.

Sorry about that mark on your forehead. It was self-inflicted

:-)
dcose
|
October 12, 2012
Will you be bringing up that you're armed and ready ? Again
SpikeVFR
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October 13, 2012
dcose - Uhh, when was the highest price in recent years? Was the summer of 2008, when it reached $4.12 a gallon, when Bush was in office...

In fact around the time Bush cam into office, national average was slightly under $2 a gallon, and reached the $4.12 during his last summer before the election. So more than doubling during his term.

Higher than even now, nationally (before even being adjusted for inflation.)

And even now the average isn't even close to $6.64 -- nice try, but I haven't even seen that at stations close to the highway. Today, according to AAA, the largest national survey, regular is at 3.802 -- about 60% of your number. And the CA average sits at about $4.631 about 70% of what you put forward.

Housing is cheaper than uder Bush, Bush oversaw huge increases in the housing bubble and did nothing to correct it or slow it down, but rather cheered it on.
dcose
|
October 13, 2012
Waiting to see the sources of your information. I used DOE and another federal sorce along with the website I cited.
dcose
|
October 13, 2012
Housing, currently tanked.

An economy in danger of slipping back. I'm not pleased with the housing prices today. You and I differ in that I cannot support a presidency that does not support business.

Until unemployment starts to drop, the price of housing will continue to stumble along.
SpikeVFR
|
October 15, 2012
for current averages, I used the AAA website and for historical information I used gasbuddy.com; but the info is out there elsewhere as well.

http://www.gasbuddy.com/gb_retail_price_chart.aspx?time=24

http://fuelgaugereport.aaa.com/?redirectto=http://fuelgaugereport.opisnet.com/index.asp

I mean, you had to have known your assertion that the average in CA for 2012 was $6.64 was false. I mean where have you seen anything even close to that? And for it to be the average, you would reasonably have to have some stations selling it at above $7 to get that average. Where do you see that? Where do you even see $6 a gallon?
dcose
|
October 15, 2012
"Where do you see that? Where do you even see $6 a gallon?"

Easy, Calm down. I posted the price from the Drudge Report picture of a station in CA. That last was not an average. I apologize for the excitement.
ChrisRoberts
|
October 12, 2012
Last time I remember gas being cheap (as in 1 dollar a gallon), Bill Clinton was still president.

I don't think it has anything to do with Republicans or Democrats. Last I remember, gas was quite high under Bush as well.

Nice try though, cowboy Cose.
dcose
|
October 12, 2012
A Perfect Storm? No.

more like "A Predictable Storm... "

How long can you run a designed production facility above 100% before a failure ?

Too bad there isn't more competition in the market place...

but that would mean more production, refining, and distributing capacity to get more fuel to market... and it's doubtful that will occur in California.

Profits/Taxes:

Oil Company, plus or minus 10 cents/ gallon for R&D, drilling, transporting, refining, storage, transporting, sales, and overhead.

Government profits, plus or minus 50 cents / gallon for taxes, regulations, and compliance.

with California's exceptional transportation infrastructure being the envy of the US how can it not bring a Biden type smile ?
Bird_Man
|
October 12, 2012
And in a little while, the financial news will announce that the oil companies will once again announce record PROFITS.
SpikeVFR
|
October 12, 2012
the 20% hit for air conditioning may have been true 40 years ago, but there should not be any cars taking that kind of hit today. Some modern cars aren't running the a/c off the engine belt at all, but rather use electricity off the battery. So there is no hit.


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