National average price of gas beats record levels after Hurrican Katrina
We resist writing posts on how expensive gas is nowadays because if we made it a habit, that's all we'd write. Every once in a while, however, there's a news story about gas prices that we can't ignore. This past week, the national average price of gas beat the previous record set in the first week of September 2005, the week following Hurricane Katrina's devastating landfall. The national average price of gas peaked at $3.11 that week. Since last January, however, the national average has been increasing on an uninterrupted pace. At the end of the first week of May, the average stood at $309.70. On May 14th, it was reported by the government to have risen to $314.30, eclipsing the previous post-Katrnia record. (Click here to view the government's archive of average fuel prices.)
We don't claim to be analysts in this area, so we wouldn't venture to guess what various factors are conspiring to push the price of gas ever higher. We don't know if or when it will level off, or perhaps even decrease, though we imagine the retreat of summer and colder temperatures will bring some relief. Nevertheless, we though it prudent to point out that as of May 14th, the price of gas is truly at record levels.
[Source: DailyFuelEconomyTip, Energy Information Administration]
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Reader Comments (Page 1 of 3)
Marc 4:39PM (5/16/2007)
wow, from $3.11 to $314.30 does seem like a bit much.... typo anybody?
"The national average price of gas peaked at $3.11 that week. Since last January, however, the national average has been increasing on an uninterrupted pace. At the end of the first week of May, the average stood at $309.70. On May 14th, it was reported by the government to have risen to $314.30, eclipsing the previous post-Katrnia record. "
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Brad Kempeny 4:51PM (5/16/2007)
hooray! another post to forward the liberal mindset that the economy sucks, gas prices are ridiculous etc. etc. However- if you happen to do any research at all- you will find that gas prices are not at record levels. If you adjust for inflation, the record price for gas was set in 1981 at $3.223 a gallon according to the energy department.
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sledge 4:51PM (5/16/2007)
Seriously John Neff and all of AB, could you please not be so damn lazy! At least proofread your articles before you post them. The $314.30 is in fact supposed to be $3.143. The prices shown on the linked page is in cents/gallon.
I am pretty sure that everyone became regular readers of Autoblog because of the quality and depth of coverage that you HAD (and I say that on purpose). I can safely say that right now you are sliding towards the kind of shoddy coverage that drove me away from other sites.
I would much rather have 5 fewer articles per day if that meant I wouldn't have to cross check half the facts and figures you put in your posts. I don't mean to be an asshole, so please take this as constructive criticism from a longtime reader.
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rem83 4:54PM (5/16/2007)
Brad,
Good point, we're only near the record gas price (and steadily rising). Nothing to worry about.
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Mulad 4:57PM (5/16/2007)
Yeah, looks like someone accidentally went from counting dollars to counting cents (the government data is usually shown in cents per gallon).
Anyway, the data I've seen and the analysis I've heard says that crude oil production is going along just fine and we've got plenty of that on hand. However, gasoline and other light fuels were not being produced at an appropriate rate in recent weeks, so the current gasoline inventory is lower than it should be.
Many refineries have been partially down for maintenance or went down because they ran into problems (probably due to lack of maintenance). This may be a side-effect of BP getting hit because of maintenance/safety violations recently. Other refineries are probably trying to catch up with maintenance problems.
Still, it seems odd that diesel supplies are in very good shape at the same time. The retail price of diesel has actually been going down for the last few weeks.
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Cervus 5:13PM (5/16/2007)
What we are seeing now is fallout from Katrina. After the hurricane and in 2006 many refineries deferred maintenance because they were trying to keep up with gasoline demand. A combination of fast-rising demand (2.5-3% over last year, refiners plan for 1.5%), refinery accidents and shutdowns, and the aforementioned maintenance issues, and lower gas imports, we have very high prices and 12 weeks of inventory drops.
Oil prices are lower than last year, but refineries only operated at 89.5% last week. Gasoline inventories rose more than expected, so did crude stocks. If this trend continues prices will drop some. They're already off their highs here in San Diego ($3.39 a gallon, 11 cents lower). I've actually seen diesel as low as $2.98.
But then, according to a trucking news source they're actually shipping 12% less cargo over the past couple months. Not a good sign for the economy.
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Paul Y 5:13PM (5/16/2007)
@#5: Not to be an alarmist/conspiracy-theorist/jackass, but I can't help but wonder how "coincidental" it is that refining capacity is low relative to demand for oil products and crude supply.
I also noticed that diesel is comparatively cheap. For some time now, I've been scheming ways to get out of my Subaru lease and into a 20+ year old Mercedes-Benz. Half the fun is the wackiness of having a quirky old car, the potential to run on vegoil/biodiesel is just a fun aside.
I was just talking to my dad about this the other day: diesel engines need to become more common in the US, because you can make diesel fuel out of pretty much anything that has carbon in it. To hell with the corn lobby. Since sugar cane isn't as easy to grow in the US as it is in Brazil, that really seems to be the sensible option.
With regards to gasoline prices, I'm glad I drive less than ever. Having a 6 mile commute, and only going farther than that when I really need to works out well.
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Brad Kempeny 5:59PM (5/16/2007)
rem83- I'm not saying its not bad- it sucks. I was just pointing out the complete lack of research "journalists" do. They see a high gas price and automatically assume they are at the highest when in fact they aren't. I do agree though that something should be done to curve the high gas prices- such as getting rid of the EPA restrictions on the kind of gas that must be sold. There are something like 35 different mixtures of gas sold in the US. For instance, gas that is sold in NY, cannot necessarily be sold in any other state because the EPA says it can't. After Katrina, President Bush suspended these restrictions and gas prices actually went down- not by much but they could have been higher. After the suspension ran out and the EPA restrictions were re-instituted, gas shot up again. It would be nice to see these restrictions lifted for good.
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bgdc 5:59PM (5/16/2007)
Gas did dip in San Diego. Still I paid 3.58 for premium last night. It was 3.68 last week.
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tom 6:06PM (5/16/2007)
All the billions of dollars in record profits the oil companies have made and they can't keep their goddamn refineries up to snuff. Pure greed. Please pass the vasoline to help ease the pain. Oh! I forgot that vasoline a petroleum product also, the price of vasoline probably went up to.
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Doogs 6:07PM (5/16/2007)
$46.41 to fill up my Mini the other day.
Bet everyone who bought those firesale Tahoes are loving this!
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JC3 6:38PM (5/16/2007)
How could anyone possibly afford to run a SUV in this day and age.Bring on the micro cars!Hey ,how about an all new Honda CRX?
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bruno 8:48PM (5/16/2007)
Gee, thanks for clearing that up, Brad! If I complain about gas prices which result in another quarter of record profits I must be a liberal? And you provided us with the facts according to a Redumblican led Energy Dept. that held secret meetings with big oil after taking office. Did Karl Rove help you with that piece?
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jg 8:14PM (5/16/2007)
Every year before summer season they raise gas prices and tell us its because of a shortage in capacity or some such garbage. They're raising it because there is more demand in the summer. That's all. Prices are controlled and manipulated to give profits without raping the consumer or killing the SUV industry. They'll go back down sometime around september (but not to pre-summer levels) and we'll be told its because there is excess supply or some other garbage. All the while the right will use it as a wedge issue against the left. It'll be the basis for all kinds of unfounded by truthy sounding talking points. Rush and Sean Insanity will go on for hours about how Hillary killed Vince Foster because he wanted to lower the gas tax or something. Matt Drudge will get involved too. Lots of flashing lights on his website to indicate breaking rumors, I mean news. And next summer it'll happen again only the prices will be higher.
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Phil 8:14PM (5/16/2007)
Oh Boo Hoo. The price of petrol here in Australia has just hit $1.40(au) per litre, or approximately $5.30US per gallon. You guys have a lot of catching up to do.
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MikeW 9:12PM (5/16/2007)
Yes but in the last 6 years, the price has tripled. Who has tripled their mileage in the time, who has tripled their income?
and our gas is very expensive not because government has taxed the hell out of it.
Where are BMW's diesels?
The 535d would just as appreciated as the 535i.
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Evan 9:18PM (5/16/2007)
I miss the days when it cost me $12-15 to fill up my car. Now - only three years later - it costs almost $30.
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tom 9:22PM (5/16/2007)
High gas prices are also killing the recreational vehicle industry. I should know I sell the damn things. Typically April-May are our best months. This year April sales were poor and may is starting out the same. If it continues I will be looking for a new job. Also I believe many RV dealerships and RV manufactures will go belly up.
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far jr 9:36PM (5/16/2007)
"Every year before summer season they raise gas prices and tell us its because of a shortage in capacity or some such garbage. They're raising it because there is more demand in the summer. That's all. Prices are controlled and manipulated to give profits without raping the consumer or killing the SUV industry. They'll go back down sometime around september (but not to pre-summer levels) and we'll be told its because there is excess supply or some other garbage."
at 8:14PM on May 16th 2007 by jg
Absolutely AMAZING how it ALWAYS works out that way isn't it?
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Chet 9:38PM (5/16/2007)
#13 -- it's called supply and demand. Demand goes up in late Spring, so the price goes up. That's not price manipulation, that's not a conspiracy, that's basic economics.
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