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War drums pump gasoline prices higher in state By Sean Wolfe Ashland Daily Tidings The reasons are many, but the outcome is clear: Oregonians are paying more at the pump. Currently, according to new figures released by the American Automobile Association, prices have jumped 10 percent, or seven cents a gallon in the last week to $1.537. Overall gas prices in the state have climbed $0.40 since a year ago, when a gallon of regular unleaded ran $1.131. The AAA attributes the climb in part to President Bush's State of the Union address, which the AAA said "solidified expectations that war with Iraq is only weeks away." AAA Oregon Public Affairs Director Elliott Eki said such steep price hikes are excessive and warned that station owners now fear having to pay higher prices to replace their stocks of gasoline. He also said he fears a consumer backlash. "Station owners must avoid panic-pricing. That could lead to panic-buying by consumers and cause long lines at gas stations, and create localized shortages," Eki said. While Californians may be accustomed to paying higher gas prices than the national average, Oregon has long been an oasis for cheap gas. According to AAA, this is the first time in at least two years that the average price per gallon of regular unleaded in Oregon is on par with the national average. Craig Randolph, vice president of retail operations for Medford-based Hays Oil, receives daily faxes on new gasoline prices from refineries. Randolph said despite the price hikes, demand for gas is still sharp. "It's not affecting demand at all. The thing is, as the wholesale prices rises, the retail price has to go up too. How else do you cope with it?" But Randolph also agreed that following Bush's address, he noticed a price escalation. "It did seem like our costs rose shortly after the speech," Randolph said. Kevin Neely, a spokesman for state Attorney General Hardy Myers, said his office has frequently been involved in gas price investigations, but said it's rare they can prove price-fixing. "We watch gas prices closely, and they tend to fluctuate pretty widely across the state. The challenge is what our office would need to do to demonstrate that there's an antitrust price manipulation effort. We have never had success in doing so," Neely said. Neely also said Myers' office was particularly interested in cases where the gasoline industry capitalizes on "national crisis," and said legislation was in the works that would make such cases easier to bring to trial. But he also acknowledged that massive mergers on the part of Chevron and Texaco, as well as Mobil and Exxon, have shrunk the number of refineries, thereby reducing competition. "It's basic Economics 101. When you have less competition, prices rise. But at the same time, this is also a volatile marketplace. At times there are world events that appear to have an impact on marketplace prices. Consequently consumers pay more at the pump. But in the absence of evidence that the price hikes are a manipulation tactic, there's not a lot we can do," Neely said. LINKS: DAILY TIDINGS: Main | News | Sports | Business | Obituaries | Opinion | Columnists | AP News | Subscribe | Archives | Weather | Classifieds | Contact Us | Privacy REVELS: Main | Calendar | Dining | Movies | T.V. OTHER: Road Cams Copyright 2003 Ashland Daily Tidings 541.482.3456. 1661 Siskiyou Blvd., Ashland, OR 97520. Ottaway Newspapers, Inc. - Advertisers -