Gasoline prices down slightly
December 7, 2000
If you can predict the weather, you may be able to predict whether gasoline prices will rise or fall this winter.
The statewide average for gas prices dropped 2.5 cents this week, according to AAA Colorado. But what prices will look like in the near future will depend on the weather and refineries’ ability to continue producing large amounts of oil, said Mary Greer, director of public relations for AAA Colorado.
“The first thing to come out of crude oil is heating oil,” Greer said. “If the crude is diverted to make heating oil, that affects prices.”
In other words, if Colorado receives cold snap, gas prices may rise due to an increased demand for heating oil. Also, if the state gets buried by snowstorms this winter, prices may rise due to problems transporting oil and gasoline over snow-packed roads.
The American Petroleum Institute cites a couple of reasons for high oil prices. According to the Institute’s Web site, supplies are tight largely because demand has been high and because OPEC (Organization of Petroleum Exporting Companies) hasn’t returned the millions of barrels of crude oil it removed per day from the market over the past few years. It also states that crude oil is expensive to keep in inventory. Over the summer, crude oil inventories averaged 10 percent less than the same time last year. The site states the refinery system has been running at about 96 percent about 5 percent higher than normal in the fall.
While gas prices in Craig have remained at $1.69.9 for the past few weeks, as has Glenwood Springs at $1.72.0, prices around other areas of the state have dropped slightly since the end of November. Of the nine cities AAA Colorado tracks, only Vail’s gas prices have risen since November.
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The statewide average is $1.57.4. That’s 5.7 cents higher than the national average of $1.51.7. Denver’s prices dropped 2.7 cents and Grand Junction’s are 2.3 cents lower than last week. Colorado Springs has the lowest prices in the state at $1.48.8, while Vail remains the highest at $1.94.4.
According to AAA Colorado, the decrease in gas prices may be from a drop in crude oil prices, which are down to $29 per barrel from $35.
“Traditionally the gas prices go down some during the fall,” Greer said. “They just aren’t going to drop as far as last year.”