Gas Prices Spike As

Holiday Weekend Begins

Gasoline prices spiked across the country at the end of last week, bringing the cost of regular grade gasoline close to the $2 mark in at Newtown’s eight gas stations –– just in time for the Labor Day weekend.

Gasoline futures rose 9.5 percent on Thursday, August 21. It was the largest single-day increase not related to an expiring contract since 1984, according to the Dow Jones Newswires. That same day, Gary Buzzanca of Buzz’s Mobil at 286 South Main Street in Newtown learned that the cost of his gasoline had risen ten cents a gallon.

“Ten cents in one shot –– that’s the biggest increase I’ve seen in 25 years,” said Mr Buzzanca this week. By the following Tuesday, he had been hit with two more two-cent increases.

Up the street at Newtown Exxon, the news was even worse. Gas prices there went up 18 cents in a week, according to proprietor Nick Kopcik. “On Friday I was notified that it went up 12 cents, and today it went up another five cents,” he said on Tuesday morning. The story was the same all over Newtown and Connecticut.

“I literally came to work and gas across the street was $1.83,” said Michael Fox, executive director of the Connecticut chapter of the Gasoline and Automotive Service Dealers of America last Friday. “I went to the bank, it was $1.90. I went to lunch, it was $1.99.

By midweek, prices in Newtown ranged from a low of $1.83 for a gallon of regular gas at Holcombe Citgo on South Main Street to a high of $2.12 for a gallon of premium gas at Halario’s Citgo in Hawleyville.

Mr Fox said he suspects oil companies may be keeping supplies low to capitalize on the upcoming Labor Day travel market –– something state Attorney General Richard Blumenthal is on the lookout for.

“We’re mindful and watchful of possible illegal practices such as collusion or price fixing,” he said.

Mr Buzzanca says that his customers certainly have their suspicions. “I’ve gotten a lot of complaints,” he said. “They all think it’s due to the holiday weekend.”

Other factors were at work, however, in producing the record price increases. Nationally, the epic blackout in the Northeast temporarily shut down some refineries, and a broken pipeline caused shortages in Arizona.

The shortages pushed average retail gasoline prices up more than 15 cents a gallon nationally, the biggest two-week hike since the Lundberg Survey began keeping records 50 years ago.

The high prices are bad news for the millions of US motorists planning driving trips over the upcoming Labor Day weekend.

The AAA auto club is predicting that the early arrival of Labor Day this year could push holiday travel to its highest level in nine years: 33.4 million Americans are expected to travel 50 miles or more from home this holiday, 84 percent of them by automobile.

While customers at the pumps were complaining, they were doing it with a sense of resignation. Mr Kopcik observed that motorists are pretty sophisticated when it comes to laying blame. “People are getting to know that it’s not the gasoline stations that are to blame,” he said, adding that people should call their representatives in Congress to investigate the fluctuations in supply and demand –– and consequently, in price.

Quite often, the gas station owners suffer right along with the public.

“We are actually losing money,” Mr Kopcik noted. “When the price jumps, dealers typically follow the jump [cent for cent] at the pumps. We pay credit card charges of three to five percent, depending on the card.” He said when the price goes up, the increased credit card charges usually come out of the dealer’s profit margin.

So far, the price increases do not seem to be discouraging people from driving. “The volume is about the same,” said Mr Buzzanca this week. “People need fuel.”

The AAA agrees. Club officials do not expect the recent spike in gas prices to deter many holiday travelers.

“Motorists have been paying higher prices throughout the spring and into the summer,” AAA spokesman Jerry Cheske said. “Some people grumble at the prices, but I don’t think it will deter them from traveling.”

(Associated Press reports were used in this story.)