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Chicago-area drivers face long, hot summer at pump

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Old 03-09-04, 10:14 AM
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Mayonnaise
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Chicago-area drivers face long, hot summer at pump

By Melita Marie Garza
Tribune staff reporter
Published March 9, 2004

Samuel Brown, a Chicago cab driver for 38 years, knows high gasoline prices when he sees them.

"This is almost the worst it's ever been," said Brown, 64. In fact, he said he is taking home about $25-$30 a week less because of gasoline prices that now top $2 for a gallon of regular unleaded at some Chicago gas stations.

"What are you going to do?" asked Brown. "I just have to put up with it."

With gasoline prices at near-record highs nationally, scattered shortages around the country reported, and OPEC production cuts expected next month, Chicago motorists are facing a costly summer driving season.

Prices easily could surpass the Chicago-area record of $2.14 for a gallon of regular unleaded that AAA reported on June 19, 2000, predicted Tom Kloza of the Oil Price Information Service. But those high prices likely wouldn't hit until August, he said.

"You could flirt with $3 a gallon at some gas stations near Lake Shore Drive," Kloza said. "But unless there's major political upheaval in Venezuela, an important supplier of gasoline to the U.S., I don't think it's going to get that much worse."

Stormy street protests against Venezuelan President Hugo Chavez have raised the possibility of another strike at Venezuela's national oil company, similar to the one that briefly shut down oil production last year, contributing to price spikes. Venezuela is the world's fifth-largest oil exporter and a major supplier of crude oil and gasoline to the United States.

Monday, the nationwide average price for a gallon of unleaded regular gasoline was $1.72, 4 cents higher than a year ago and only 2 cents lower than the all-time weekday record of $1.74 reported on Aug. 29, 2003, according to AAA.

The average price in the metro area on Monday was $1.80, 3 cents higher than a year ago at this time.

Prices within the city of Chicago on Monday ranged from $1.90 to $2.10, although one North Side station was selling unleaded regular at a full-service pump for $2.60 a gallon.

An array of factors have helped create the price spike, including increased demand for gasoline in the improving U.S. economy, new requirements for lower-sulfur gasoline, which some overseas suppliers can't meet, and refinery maintenance shutdowns in February and March, said JoAnne Shore, senior analyst for the federal Energy Information Agency.

In January 2003, the U.S. imported 818,000 barrels of gasoline a day. This January, imports were about 200,000 barrels a day short of that amount, while demand ratcheted up about 125,000 barrels a day, Shore said.

"We have a tight market situation as we go through our spring transition," Shore said. "We are watching the supply situation very closely."

Competition for ethanol

What's more, the Chicago-Milwaukee region, which uses a special summer blend of reformulated gasoline, will have to compete with California, Connecticut and New York for blending components. Those states have switched to ethanol-blended gasoline.

"If there is a serious supply problem, Chicago could get some pretty sharp price increases over a short period of time before things settle down," Shore said. "And a problem in California now could really hurt Chicago."

Kloza said that other forces are at play behind the scenes: namely, speculators.

"The rally began Nov. 4," Kloza said. "It doesn't make sense that the pitchers and catchers hadn't reported for spring training yet, and the prices were already on the way up.

"The big money managers have poured in the money. The speculators operate in the shadows; nobody really knows who's moving $200 million out of euros or the peso into oil or gasoline."

On Friday, the Commodity Futures Trading Commission reported that such speculation was at an all-time high, with more buyers than sellers for crude oil and gasoline.

U.S. light crude closed Monday at $36.57 a barrel, down 69 cents, on the New York Mercantile Exchange.

Stubbornly high prices are propped up in part by anticipation of an OPEC supply cut on April 1, which is expected to shave 1 million barrels per day off the cartel's 24.5 million-barrel-per-day crude-production ceiling.

Rethinking vacation

Higher prices may influence vacation plans for Melissa Masterson, 32, a University of Chicago graduate student in public policy who gassed up Monday at the Mobil station at Fullerton and Seminary Avenues. A gallon of regular unleaded gasoline at the station was priced at $1.90.

"I may not drive my car as much," Masterson said, as she spent $15.24 on 8 gallons of gas for her Volvo S40.

"Nowadays I usually fly everywhere on vacation anyway, but they say fuel prices will make that more expensive too," she said.

She confines her Chicago driving to the commute to the U. of C. from her Lincoln Park home and to weekend visits to her parents' Barrington home, where she makes a point of filling up at a cheaper suburban gasoline station. For trips downtown, Masterson said she always takes public transportation.

"Gasoline is up about 10 cents to 20 cents more in the city, depending on which station you go to," Masterson said. "I guess I'm just coming to expect these prices in the city. Although I really thought that with what we were doing in Iraq, we wouldn't have these kinds of problems."


Copyright © 2004, Chicago Tribune
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Old 03-09-04, 11:29 AM
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gasoline prices

In San Diego, we are currently at about $2.25 for 87 octane, closing in on $2.50 for 91. I keep hoping it tops $3 soon.
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Old 03-09-04, 12:45 PM
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Phoenix is in the same boat. I have started commuting by bike every day instead of just 4 days a week.
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Old 03-09-04, 03:54 PM
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I drive a vehicle that gets a 13 mpg. I advocate 5 dollars per gallon tax, that goes to public transit.
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Old 03-09-04, 06:34 PM
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Gas prices suck... unfortunately in Orange County.. the public transportation blows, the train Icould take to work isn't reliable, and costs more than for me to drive... and there is no way I'm gonna go my 56 mile round trip with hills commute everyday... so until my work moves.. I'm stuck driving

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Old 03-09-04, 07:07 PM
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Originally Posted by John E
In San Diego, we are currently at about $2.25 for 87 octane, closing in on $2.50 for 91. I keep hoping it tops $3 soon.
Even if you don't have a car, you still pay for those high prices.

Remember, everything you buy is shipped from the factory to your local store using some sort of oil-based fuel. As the cost of fuel rises, so do the prices.

In the meantime, riding a bike is certainly a good self-defense measure against high prices. In addition to avoiding the gas pump, we help reduce demand so that our SUV addict neighbors can get a little break on their fuel bill.

And for all we do, they still scream at us as they guzzle on past.
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Old 03-09-04, 09:09 PM
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Originally Posted by supcom
Even if you don't have a car, you still pay for those high prices.

Remember, everything you buy is shipped from the factory to your local store using some sort of oil-based fuel. As the cost of fuel rises, so do the prices.
That isn't nearly as true as people make it out to be. Fact is, the price of any good or service we by is determined firstly by the supply and demand for that particular good, then by the prices industry competitors are charging. Fuel cost comes somewhere down the list. I would think a more likely consequence of long-term higher fuel prices is that firms would simply find more efficent ways of doing things.

It won't be the end of the world as we know it. Remember that our species survived for something like 2 million years without the stuff at all.
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Old 03-10-04, 04:09 AM
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Originally Posted by Chris L
That isn't nearly as true as people make it out to be. Fact is, the price of any good or service we by is determined firstly by the supply and demand for that particular good, then by the prices industry competitors are charging. Fuel cost comes somewhere down the list. I would think a more likely consequence of long-term higher fuel prices is that firms would simply find more efficent ways of doing things.

It won't be the end of the world as we know it. Remember that our species survived for something like 2 million years without the stuff at all.

Yeh! we could all revert back to the Horse and Cart. Think of that. all the School Mums, hacking along with their sprats in the cart jostling like ancient Charioteers for parking places.

Supermarket lots with stalls and feeding troughs, with slogans on their billboards "be content that your Stead is grazing happily whilst you roam our Malls".
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Old 03-10-04, 08:02 AM
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Here goes again: USD 2,14 for a gallon? That is NOT high. Our cagers pay about USD 4,6 for a gallon. Much of it is tax.

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Old 03-10-04, 09:50 AM
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Originally Posted by Chris L
That isn't nearly as true as people make it out to be. Fact is, the price of any good or service we by is determined firstly by the supply and demand for that particular good, then by the prices industry competitors are charging.
Bingo. That's exactly what I was thinking as I read the article. The New York City subway is subsidized so spikes in gas don't effect me at all. We aren't scheduled for a fare increase for another 3 years so I'm safe. I can travel 50 miles for as little as $1.37

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Old 03-10-04, 10:01 AM
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>>>>>>>With gasoline prices at near-record highs nationally, scattered shortages around the country reported, and OPEC production cuts expected next month, Chicago motorists are facing a costly summer driving season.<<<<<<<

What are people doing driving cars in Chicago? Doesn't that city have excellant subways and bus transport? Why should we feel sorry for those knuckle heads who live in the burbs of Chicago? I don't feel sorry for the motorists in New York City as there is an excessive amount of public transportation available. As far as I'm concerned, anyone who owns a car in New York City or Chicago doesn't get one ounce of pity from me.

On a separate issue, the folks at OPEC are doing this to extract more money from us and they are going to get it. This is what happens when you become so dependant on someone they eventually take advantage of your weakness. The days of cheap gas are going by the way side as these oil dealers half way around the world are going to end the party real soon. It was assumed that there would always be cheap fuel and lots of it. That was a mistake.
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Old 03-10-04, 03:18 PM
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What are people doing driving cars in Chicago? Doesn't that city have excellent subways and bus transport?
About 10 years ago, I spent several days in downtown Chicago at an electronics industry conference. I rented a car, kept it about a day, and then returned it early in disgust because public transit was pretty good and parking and driving were a royal pain. I learned that even my delightful weekend afternoon side trip to Frank Lloyd Wright's house and studio in Oak Park could have been completed very conveniently via transit.
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Old 03-10-04, 03:22 PM
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Originally Posted by supcom
Even if you don't have a car, you still pay for those high prices.

Remember, everything you buy is shipped from the factory to your local store using some sort of oil-based fuel. As the cost of fuel rises, so do the prices.
I live in a 3-driver, 3-car family. I always select a 4-cylinder engine when buying a new car, and since I use various combinations of transit, jogging, and cycling to commute to work, I drive significantly less than the average person. If the price of gas goes a bit higher, perhaps at least some people will elect to downsize with their next vehicle purchase.
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Old 03-10-04, 06:57 PM
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Originally Posted by John E
I live in a 3-driver, 3-car family. I always select a 4-cylinder engine when buying a new car, and since I use various combinations of transit, jogging, and cycling to commute to work, I drive significantly less than the average person. If the price of gas goes a bit higher, perhaps at least some people will elect to downsize with their next vehicle purchase.
Well, @#$#@@$. I just did the math, and in my two car, two driver family, I've got the same amount of cylinders.

However, my wife wanted a new car, and I convinced her that she didn't need an SUV. So, we only have one of those (which get's used for the purpose it was intended for, and left in the garage during the week).

Really, I think if people re looked at what they needed, they'd find an acceptable choice. There are smaller cars that are fast, efficient, and luxury. And with traffic, etc, they are just as nice to sit in. My wife's desire for an SUV was to "be able to see ahead". We got a a car with superb brakes, so she can stop on 1/2 a dime, navigation, so she can know where she is... and really, if she's stuck in traffic, she's stuck in traffic. Something she acknowledges today.

There are REAL alternatives out there that do fit personal wants, that are not much if any of a compromise.
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Old 03-10-04, 07:00 PM
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Remember, the US car culture is only about 80 years old; when we talk about changing it we aren't talking about rewriting the Bible or knocking down the Pyramids!
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Old 03-10-04, 08:07 PM
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You also have to remember how quickly and tightly this car culture you speak of has integrated itself into pretty much every aspect of our lives. Off the top of my head if I name 100 people, 90 of them depend on being able to drive into work from 60-100 miles away.

When you have a society resting on the foundation of an 80 year old pyramid, it's a) pretty shakey up there at the top and b) not as easy to tear it down.

Best we can hope for is to individually prepare ourselves to be able to get around as efficiently as possible w/o anything that sucks down gas so when the inevitable does happen, we're not left stranded.
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Old 03-10-04, 09:07 PM
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Originally Posted by willic
Yeh! we could all revert back to the Horse and Cart. Think of that. all the School Mums, hacking along with their sprats in the cart jostling like ancient Charioteers for parking places.

Supermarket lots with stalls and feeding troughs, with slogans on their billboards "be content that your Stead is grazing happily whilst you roam our Malls".
On the contrary. A simple decentralisation of urban life would dramatically reduce the amount of driving people need to do without really eliminating anything. As I said before, if the market for various products is there, the entrepreneurs will find a way to satsify it.
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Old 03-12-04, 03:13 PM
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Current UK price is about $5.40/US gallon (if my arithmetic is correct) (@ $1.80 to the £)

We feel your pain, America
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Old 03-12-04, 03:17 PM
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Originally Posted by atbman
Current UK price is about $5.40/US gallon (if my arithmetic is correct) (@ $1.80 to the £)

We feel your pain, America
I hear you guys over that side of the ocean got a real nice train system... lucky you.
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Old 03-12-04, 10:56 PM
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You know whats wrong with this? We live in a democracy. Only half of the people vote. If 51% of us voters got our act together, we could make the remaining 41% and the nonvoters, move us around in pedicabs. There are enough of them! they could be our slaves! Hah ha ha, hah ha ha!( mad social scientist laughing). Wait. I guess we have to first legislate that everyone else no longer has the right to vote.
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