End of gas price hikes nowhere in sight

Jacob Kendall fi lls his gas tank at a Quincy station Monday with prices up to $3.90 a gallon for regular blends, and expected to rise. (H-W Photo/Michael Kipley)
Posted: Feb. 20, 2013 11:44 am Updated: Mar. 13, 2013 12:06 pm

Herald-Whig Staff Writer

Brace yourself, the worst may be yet to come as far as those annoying gas prices are concerned.

As the cost per gallon continues to soar toward $4 -- it's currently $3.90 in Quincy -- there seems to be no specific rhyme or reason for (most of) the recent price increases. And some more sizable hikes could be in the offing in the coming weeks, as much as 40 to 60 cents per gallon.

"It stinks, it's outrageous," said Mike Right, a St. Louis-based vice president and longtime analyst for the AAA Auto Club who monitors various gas-related markets in the Midwest, South and the often-volatile Gulf Coast areas.

Right said he's at a loss to try and explain the recent increases.

"There's plenty of gasoline out there, and the price of crude oil is (about the same) as it was a year ago," he said.

For those who make their living on the road, the latest round of price hikes can take a major toll. Mark Dedert of Quincy is one of those who spends considerable time traveling as a technical sales representative for Mantek, a Texas-based manufacturer and provider of lubrication products.

"I travel about 3,000 miles a month within a 100-mile radius of Quincy," Dedert said. "When the gas prices get high like this, I try and schedule as many appointments in one area as I can. I also figure I need to work a little harder."

Right said it is next to impossible to try and predict the price of gasoline these days. He specifically pointed to numerous forecasts in late 2012 that felt the American public would be paying less at the pump in 2013 than it did in 2012.

"They've already been proven incorrect," Right said.

Some extremely disheartening news comes from Patrick DeHaan, the senior petroleum analyst for He is concerned about what the next few weeks and months might hold.

DeHaan said in several published reports this week that he is surprised to see the price per gallon so high in February, when demand is normally low.

"Traditionally, gas prices rise anywhere from 40 to 60 cents a gallon in late March through early May," DeHaan said.

That 40-to-60 cent increase per gallon could be just over the horizon, which would shatter the all-time Quincy record of $4.21 per gallon established on July 17, 2008.

"I don't know why we wouldn't (see that kind of price increase)," said Bill Fleischli, executive vice president of the Illinois Petroleum Marketers Association. "I look for things to flatten out in the next month and then we'll probably see the spring price hikes."

Kenny Pratt of Ursa finds it difficult to understand why there is a 30- to 35-cent difference in the price of a gallon of gas in Quincy and surrounding towns and Hannibal, Mo.

"There's an 8-cent different in the taxes between the two states," Pratt said. "It just doesn't add up."

One item that may be driving the price up, according to an ABC News report, is the anticipation of higher oil demand as the U.S. jobs picture and consumer confidence brightens -- kind of an economic Catch-22.

Other theories involve regional refinery issues, the switch from winter to summer blends that necessitates down time in refineries and unexpected refinery maintenance costs.

"And there's always the worry about what Iran and Syria may do in the Middle East," Fleischli said.

A lot of theories, but no concrete answer at a time when most Americans are trying to absorb hits to their wallets from winter heating bills and smaller paychecks, the result of changes in payroll taxes.

"There's probably a good chance we'll see a national average of $4 a gallon," Right said.

The national average is currently $3.72 a gallon.

Illinois is $3.92 and Missouri $3.60.




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