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By STEVEN NALLEY
Ricky Tate has retired from Mississippi State University, but that hasn‚Äôt stopped him from taking up a private plumbing business with his brother, Kevin Tate. The price of gasoline, however, is slowing him down.
‚ÄúIt‚Äôs hard to get people to put up extra money for gas,‚ÄĚ Ricky said. ‚ÄúThat often ends up coming out of our own pocket.‚ÄĚ
Smiling, Kevin then added, ‚ÄúWe‚Äôll be looking for a wagon and a mule if it goes any higher. That‚Äôs all we (will be able to) afford.‚ÄĚ
Average gas prices in Mississippi have risen more than 20 cents in the past week and more than 45 cents in the past month, part of a nationwide gas price hike that even the industry‚Äôs top analysts are struggling to explain.
As of Thursday, MississippiGasPrices.com reported a state average gas price of $3.64 per gallon, compared with $3.44 one week before and $3.18 one month before. The site also reported a national average of $3.73 Thursday, compared with $3.61 a week ago and $3.27 a month ago. Prices in Starkville reported on the site ranged from $3.59 to $3.72 Thursday.
Curt Crissey, owner of multiple BP stations in Starkville, said he could not explain the price increases, and neither could any colleagues he had talked to. He said he found it especially unusual that he saw no specific news items to point toward ‚ÄĒ no sudden increases in conflict in oil-exporting Middle Eastern countries or natural disasters destroying oil infrastructure.
‚ÄúI‚Äôve asked my suppliers; I‚Äôve asked everyone I could ask,‚ÄĚ Crissey said. ‚ÄúI can‚Äôt tell you. I really don‚Äôt know. Most people are going to tell you they don‚Äôt know.‚ÄĚ
Gasoline retailers have minimal influence on the price of gasoline. The U.S. Energy Information Administration reports that 9 percent of gasoline‚Äôs price comes from distribution and marketing and 68 percent of it derives from the price of crude oil. As such, AAA spokesperson Don Redman said the two factors most likely to drive up gas prices were increases in crude oil prices or significant drops in gasoline inventory. Neither of these appeared to be the cause this time, he said.
‚ÄúCrude oil has been vacillating between $95 and $97 per barrel. It‚Äôs high, but it‚Äôs been steady,‚ÄĚ Redman said. ‚ÄúRight now, inventory of gas is slightly above average for this time of year. This is usually when you have significant drawdown on gas inventories. You‚Äôll have scheduled closures of refineries where they perform important maintenance work.‚ÄĚ
The drawdown also tied into the change of seasons, Redman said, because blends of gasoline used in the winter differed from those used in the summer. He said Environmental Protection Agency regulations required a different gasoline mixture for summer months that reduced air pollution, and the transition to these fuels typically happened in April and May, bringing with them the highest gasoline prices of the year.
So, he said he and other analysts were surprised to see such an increase in February, and they, like Crissey, struggled to pinpoint the cause.
‚ÄúWe‚Äôre at historic high prices for this time of year,‚ÄĚ Redman said. ‚ÄúThe run-up right now runs contrary to anything we‚Äôve seen in the past. It‚Äôs unprecedented for this time of year to have prices run up this high without there being a significant war or disruption of oil lines or refineries going offline. That is what is confounding analysts.
Truthfully, (these increases have) many analysts scratching their heads.‚ÄĚ
At this time, Redman said, AAA stood by a prediction by the U.S. Department of Energy that the national gas price average would peak at about $3.90 this year. He said it‚Äôs possible that the spring fuel blend transition could simply be starting early. If not, he said, the transition could drive prices even higher when it did arrive.
Consumers at Starkville‚Äôs gas stations reported varying responses to high gas prices. Emily Strickland, a freshman majoring in kinesiology at MSU, only filled up her car‚Äôs tank a fraction of the way, and she said it was because filling it completely was too expensive.
‚ÄúI live on campus, so I don‚Äôt use my car as much. I just get (the gasoline) I need from time to time,‚ÄĚ Strickland said. ‚ÄúYou‚Äôve got to save your money. I don‚Äôt have as much money to spend on things I want.‚ÄĚ
Wes Gordon, a fundraiser for the MSU Foundation, said he saw no point in worrying about gas prices, because those prices would not change his travel needs.
‚ÄúI‚Äôve got to get where I‚Äôve got to go. It is what it is,‚ÄĚ Gordon said. ‚ÄúI‚Äôm not one of those people who‚Äôs going to drive 10 miles out of the way to save two pennies on gas.‚ÄĚ
Robert Guy, like Ricky Tate, is a retiree who went into business for himself, hauling dirt as a construction contractor. The price of gas was bad for business, he said, but he, too, believed it couldn‚Äôt be helped. Guy is 72 years old, and he said he believed strongly in the importance of staying active in retirement.
‚ÄúYou‚Äôve got to ride. At my age, I can‚Äôt just sit still and do nothing,‚ÄĚ Guy said. ‚Äú(But), if it gets up to $4 (per gallon,) I‚Äôll have to leave the job alone and go fishing. To tell the truth, I‚Äôd get more enjoyment out of fishing anyway.‚ÄĚ