Average price for a gallon of regular unleaded gas in each county

The New York Times


April 30, 2006

As Gas Prices Go Up, Impact Trickles Down

It is hard to watch the numbers flutter ever upward on the gas pump these days. A look at the ripple effect of rising gas prices across the country:

The End of Fun and Games

Gas prices are not doing much for the love life of Fernanda Tapia.

A student at Brandeis University in Waltham, Mass., Ms. Tapia, 21, is among the untold number of money-strapped college students who have been grounded by the pumps.

Ms. Tapia's red 2004 Dodge Neon was supposed to be a ticket to freedom when her brother passed it down to her in January. She had planned to drive to Manhattan each weekend to visit her boyfriend at New York University, and also dreamed of going out to restaurants and making day trips with friends.

But the car has been nothing but a money-guzzler, she said, leaving her so short of cash that the car often sits in the parking lot outside her apartment.

"When I first got the car it was all fun and games, but I found out it's pretty expensive to fill the tank," Ms. Tapia said. "I don't even want to put gas in my car right now."

Unexpectedly high gas prices are also putting a crimp in the summer plans.

J. R. Cowan, a history major at Quinnipiac University in Hamden, Conn., said he decided against a cross-country summer trip because "gas would cost double what I budgeted for when I started dreaming about California last year."

When Amanda Early, a junior at Seton Hall University in South Orange, N.J., accepted a four-day-a-week summer job in public relations near the campus, she did not realize it would amount to a sentence of spending an entire summer in New Jersey. Ms. Early had planned to drive home to Connecticut every weekend, but she said gas prices would force her to remain in New Jersey in the house she shares with four other girls.

"This is a college town," Ms. Early said, "and it is nowhere near as much fun in the summer."

A sophomore at Northwestern University in Evanston, Ill., who declined to give his name because he did not want to risk angering a prospective employer, said he might turn down a summer job delivering prescriptions for a pharmacy in a Boston suburb. The $10 hourly wage was acceptable, he said, but not the requirement that he drive his own car and pay for gas.


Defending Big Oil

John C. Felmy, the chief economist of the American Petroleum Institute in Washington, the main trade association for the oil business, sounds frustrated.

As an undergraduate at Pennsylvania State University, he said, he drove to Boston with his debate team during the Arab oil embargo. More than 30 years later, he can recite the topic for 1973-74 without hesitation: "Resolved, the federal government should control the supply and utilization of energy in the United States."

On the drive back, Mr. Felmy recalled, his group was almost stranded in Connecticut because no gas was available, a result, he said, of government misallocation. Government, Mr. Felmy said, can make energy problems worse.

"I thought we'd learned from bad energy policy by now," he said, although there are days when he is not so sure. Those are the days when his computer flashes with hate e-mail from people who blame the American oil industry for the rise in oil prices.

"People just simply don't know the facts," he said, "but they accuse you of everything you can imagine."

Mr. Felmy's organization has been arguing to anyone who will listen that over the long haul, oil company profits are almost identical to the average for manufacturers in the United States, and that since 1982, the price of petroleum products is up less than the price of pulp and paper or lumber, and only about one-third as much as drugs and pharmaceuticals. But it has been tough going, with the public and with legislators, he said.

"The politicians are reading all the polls, they know how concerned consumers are, and they are trying to figure out what to do about it," he said. "Some are lashing out, attacking the industry, using information that is simply inaccurate."

Mr. Felmy said he was proud of what he did for a living, and he called institute members "honorable companies."

"They're doing what they should do, what is legally required for their shareholders, unlike other companies you've heard about in the news," he said. "They are managing their business properly, keeping fuels flowing to consumers, even though we're operating in places where sometimes people are shooting at us."

His industry, Mr. Felmy said, is "1.4 million Americans working to keep your gas tank full 24 hours a day."



Driving Guzzlers for a Living

Few drivers feel the pain of soaring gas prices as acutely as the New York City cabbie stuck behind the wheel of a Crown Victoria sedan with a thirsty, overworked eight-cylinder engine.

At the entrance to the Checker Management taxi depot in the Long Island City section of Queens is a trio of old, battered pumps where returning cabbies refill their bottomless tanks after their 12-hour shifts.

The old pumps offer only regular unleaded, and for the very modern price of $3.15 and nine-tenths of a cent per gallon. It is still lower than prices in Manhattan, where most of these cabbies go through a full tank of gas lurching and screeching around traffic-clogged streets for 12 hours.

Back at the depot, they replenish their tanks, shaking their heads in disgust as the pumps' rusty digit counters spin.

"We drive 12 hours a day, so we feel it more than anyone," said one driver, Peter Lee, 54, who began driving cabs in New York in 1972. He pointed to the depot's fleet of Fords, mostly Crown Victoria sedans.

"These things get about 10 miles per gallon in the city, 8 miles if the customer wants the air-conditioner on," he said, adding that gas mileage was made worse by the choppy gas-brake-gas-brake driving style required in New York City. "New York people are always late and telling you to drive fast, so you have to keep gunning the engine and then braking, which uses more gas."

The drivers at the depot, just across the East River from Midtown, are almost all immigrants, and all kinds of languages, dialects and accents can be heard in the tight locker room. They wolf down home-cooked meals whether couscous, curry or rice and beans before their shifts. With the Manhattan skyline looming to the west, they gather in the parking lot and grouse about gas prices.

Drivers often log 150 miles a shift and spend almost $50 in gas, Mr. Lee said, about $20 more per day than a year ago. He recommended that the city order a 50-cent surcharge for each fare to compensate cabbies for price increases.

Most drivers at the depot rent their cabs for 12 hours at a time, usually paying more than $100. They pay up front in cash and get a key to a cab with a full tank of gas; they must refill it when they return the cab.

"Compared to a year ago, I pay $15 more a day in gas," said Miguel Gonzalez, 67, of Queens. "I only take home $100 a day, so that's my lunch and dinner right there."

Lesly Richardson, 50, a Haitian immigrant from Brooklyn, nodded in agreement.

"That's $100 a week," he said. "That's your grocery bill."


New Hope for Ethanol

These are happy days for an ethanol man.

The price of grain-alcohol fuel is up sharply as demand has surged, and Colorado's newest ethanol plant is almost ready to open after four years of preparation and sweat by Dan R. Sanders and his family.

"It's great for us," said Mr. Sanders, 28, as he watched one of the first loads of corn ethanol's main ingredient arrive on Friday morning from a farm in northeastern Colorado.

When Mr. Sanders's company, Front Range Energy, begins shipping next month from this $60 million factory in Windsor, Colo., an hour north of Denver, it will just about double Colorado's ethanol production, adding 40 million gallons a year to the pipeline. And at least two other plants around the state are in planning.

Ethanol, which is essentially identical to the old corn liquor of moonshine fame, is increasingly blended with gas to reduce emissions and replace other additives like MTBE, or methyl tertiary butyl ether, which is a suspected carcinogen.

But more and more vehicles are also able to burn commercially available ethanol fuels like E85 85 percent grain alcohol and kits can also be bought that allow cars to burn an even higher percentage of ethanol. All this has further increased the demand, and the price. In most parts of the country, E85 sells for 30 cents to 60 cents a gallon less than regular unleaded gasoline, but most cars get fewer miles to the gallon burning ethanol.

Ethanol has its critics. Some economists say that farm subsidies blur the fuel's real cost, making it a less than perfect long-term alternative in thinking about the world after oil.

But here in Colorado, people like Mr. Sanders say the economics make more sense than ever. Until recently, ethanol could only make money if distilled close to its fuel source, he said. That is why corn-country Iowa dominates the nation's production.

Increasing demand is shattering that boundary, making factories feasible closer to where the product gets sold. About half of Front Range's output, Mr. Sanders said, will go no further than Denver.

The Sanderses have also lined up local buyers for the waste. The left-over corn mash will be sold as cattle feed, while the carbon dioxide produced by fermentation will be made into dry ice and sold in the Denver market.

But operations like this are still small potatoes by the scale of big oil. On a day when the Chevron Corporation was announcing $4 billion in profits, Mr. Sanders and his wife, Jana, and their 2-year-old daughter, Ellie, were watching the corn arrive. And Ellie was not even very interested.


Cutting Into Travel and Food

Jeremy Cole looks at the black numbers on the blue Marathon Gas sign in Kirtland, Ohio $2.87 for a gallon of regular and thinks of his broken vow.

For two years, Mr. Cole, 19, had given his girlfriend a gift on the 25th of each month, to commemorate the day they met Jan. 25, 2002 at Willow Hill Baptist Church in Willoughby, Ohio.

But for the past three months he has missed the date as gas prices have risen.

This month, Mr. Cole bought her a rose and a pink wind chime, because she loves to hang pink things from the ceiling of her bedroom.

The fuel warning light in his 1993 Honda Accord was glowing. It was a 25-mile drive to her house in Chardon, and Mr. Cole, who studies computers at Lakeland Community College and earns $8.18 an hour working in a factory that heat-treats metal, did not have money for gas. So he stayed home.

"I won't be able to see her till I get paid," he said. "Ever since gas prices went up, it's like I'm barely able to see her."

Until this year, Mr. Cole said, he always filled his tank. On one recent day, though, he bought only five gallons for $14.35, barely enough to drive to school, work and straight back home.

A guitar lies across his back seat, and his trunk is filled with amplifiers. Mr. Cole plays in a band called In All His Ruin. Before gas prices jumped, band members drove separately to practice at the drummer's house in Chesterland, 15 miles away. Now they all meet at Mr. Cole's house and carpool, squeezing themselves and their equipment into a different member's car every week.

On the way home, Mr. Cole used to stop at Wendy's and order the No. 6 combo meal: spicy chicken sandwich, medium Dr. Pepper, medium fries. Now he orders junior hamburgers from the dollar menu.

"It's not a gourmet meal anymore," he says. "French fries are an extravagance now. It makes me angry that I have to change my whole life because of gas prices."


At $2.39 a Gallon, a Bargain

Cheap gas prices are in the eye of the beholder.

At the Flying J Travel Plaza in Casper, Wyo., a gallon of regular unleaded gas sold this week for $2.39, about as low as anywhere in the country and more than $1 less than some places in California and Hawaii.

But gratitude at the pumps? Forget it.

"Gas prices don't seem low to me," said Dick Gilbert, a tow truck operator, who was out $170 filling his vehicle's two tanks. "And they just keep going higher."

Mr. Gilbert was preparing to burn most of the gas on a 250-mile round trip to retrieve a broken-down truck. He will charge his customer $2.50 a mile, but even so, he said rising gas prices were eating into his profits.

In an adjoining gas lane, Cindy Wright spoke of the pain high gas prices cause the single mothers who make up many of the clients at the public health clinic in Torrington, where she is a nurse.

"They can't afford to drive," she said. In another sign of the times, Ms. Wright said, a relative who owns an auto repair shop arrived at work one morning recently to find that thieves had siphoned gas from vehicles left there overnight.


Caught in the Middle

Pity the people who sell gas in San Francisco or lease franchise stations from the oil companies. No, really. As if working around fumes and grime were not enough, now customers are rude even hostile about the sudden escalation in gas prices, which in San Francisco are among the highest in the country.

"Someone today threw the money down, and said, 'This is ridiculous,' " said Stella Liu, 51, who leases a 76 gas station from Conoco and runs an adjacent automotive repair business. Other customers scream at her cashier before jumping into their cars and tearing away from the station.

Ms. Liu, though, is sympathetic. She too has to buy gas to fuel her 50-minute commute (one way) from the suburbs. "If I were making the money, I wouldn't be here," she said, "We are all in the same boat."

Prices may fluctuate, Ms. Liu said, but even when gas is $3.36 for a gallon of regular, as it was on Friday at her station in the Potrero Hill neighborhood, her profit is unchanged because she is paying more to her supplier.

"It's the same for me as it is for the customer, maybe worse," she said. Business is down because people are buying less gas choosing a quarter or a half a tank and then paying by credit card. "We have to pay insurance and workers compensation, the rent," she said. "We are making the same money we did years ago. Only now, it barely covers the cost of our overhead."

Many customers understand the dealers are not at fault, but others simply rage at the nearest target.

She advises angry customers to contact Conoco.

"I tell people, I'm just the dealer. I have no control over the price. I don't even know why the price is going up."


Trying to Share the Pain

In a region where buses advertise that "Gas isn't expensive if you don't buy any," Matt Mulholland of Lynwood, Wash., assumed it would be easy to arrange a carpool for his daily commute, especially as gas approached and passed $3 a gallon.

"Let's save time and gas!! yes yes YES please," Mr. Mulholland wrote on the Craigslist Web site.

A month later, Mr. Mulholland, 32, still drives alone. No one responded to repeated pleas to share the 40-mile round trip from his home north of Seattle to Bellevue, a city east of Lake Washington. He is disappointed, not least because, with a passenger, he could zip into Interstate 405's high-occupancy vehicle lanes and prune his hourlong commute.

"I look at cars around me and they always have one person," said Mr. Mulholland, who works as an estimator for an auto body company. "I thought I'd probably have more chance of getting somebody interested now, when they're talking about prices peaking at $4 by the end of the summer."

But so far, the shock of $3 gas has not persuaded many commuters to change their behavior.

There has been no increase in registration for the Rideshare program, which arranges carpools and vanpools for the county that includes Seattle and Bellevue, said Cathy Blumenthal, the program's coordinator for King County Metro Transit.

By contrast, 5,000 people a 62 percent increase over the previous year signed up to share rides last fall after Hurricanes Katrina and Rita drove local gas prices toward $3.

While Mrs. Blumenthal wonders if people are waiting either for prices to surge or recede before they alter their driving habits, Mr. Mulholland is more pessimistic.

Complaints about gas prices are "hype, a hot button," he said. "People talk without doing anything."


This article was written and reported by Kirk Johnson in Windsor, Colo.; Corey Kilgannon in New York; Jessica Kowal in Lynwood, Wash.; Christopher Maag in Kirtland, Ohio; Carolyn Marshall in San Francisco; Doug McInnis in Casper, Wyo.; Matthew L. Wald in Washington; and Katie Zezima in Boston.