Gas spikes

Gas pump prices jumped to their highest mark in two years over the weekend, but the reason may not be what you're thinking.
Marie Havenga
Jun 4, 2013

The price at the pump for regular no-lead gas vaulted to $4.15 a gallon in the Tri-Cities before dropping a penny or more at most stations on Monday.

Tornadoes and other storm surges are not to blame, according to Patrick DeHaan, senior fuel analyst with Chicago-based GasBuddy.com.

While the storms did their damage on the ground, the recent spike in fuel prices is due to mechanical breakdowns at Midwest refineries that have limited regional output, according to DeHaan.

“These facilities are 100 years old in some cases,” he explained. “They can't be expected to run full-tilt without breakdowns. ... At times you have outages that limit the ability to produce gasoline.”

Spring Lake resident Darlene Tuttle said the prices are frightening. She and her husband drive an eight-cylinder Chevy Silverado that gets about 15 miles per gallon.

“Things are so high-priced now,” Tuttle said. “To up the gas even more, I guess they're really trying to break us. I'm just shocked at the price. It really does make you wonder why it has gone up.”

To add fuel to the frustration, the Great Lakes is the only region in the country affected by the price jump, DeHaan said. The rest of the nation's pump prices remain steady in the $3.50-to-under-$4 a gallon range.

“Oil refineries remain the bottleneck this time around,” DeHaan said.

Spring Lake resident Kathy Boelema said she's going to do her best to keep away from the pumps for a while.

“I'm going to try to conserve," she said. "If I go into Grand Haven, I'll try to get all my errands done at the same time. If I go to Ferrysburg, I'll try to run errands in Norton Shores.”

DeHaan said the price surge caught him off-guard.

To read more of this story, see today’s print or e-edition of the Grand Haven Tribune.

 

Comments

Wingmaster

Must be Bush's fault! It always was when he was Pres.

bigdeal

Another moronic answer. Luckily that family is history (Barbara Bush, "I think America has had enough Bush's"). I love when repubs caw about capitalism while driving their gas guzzlers. To too many this means deciding between buying food, or gas. Because at all those jobs you provide for them Wing, they only make $8/hour and only get 20 hours a week so you don't have to provide benefits.

Wingmaster

Well, lets have some more capitalism, I'm all for it.

Can you offer more than name calling. Oh, that moronic answer seemed to be ok back during his administration...why doesn't it apply now...hmmm?

Lakeshorelookout

Ok.. So why should we have to PAY DEARLY because there is a mechanical breakdown at a refinery? If I catch a cold, I do not charge the company more for what I do. Why should they be able to get away with this legally. At anytime a refinery could have a "Breakdown" and rake in the money from an already struggling economic consumer. Maybe one of the Executives has to buy another home, boat, plane or car. So what regulation is in place and why do we have to pay for to fix something that is broken? It smells fishy!!!!

BTL2A

That's the way most businesses run.. Their cost go up they pass it on to the consumer.

Lakeshorelookout

I am very aware of how business is run however the "Costs" are not going up for the producers. It is due to the fact that there is one refinery that has an issues but ALL gas has gone up in our area.

Lanivan

There has been no new refineries built in the US for 35 years. Investment has gone into expanding the capacity of aging existing refineries, making US capacity the largest in the world. The bummer is that aging refineries need lots of maintenance, break down often, etc, and because of the law of supply and demand, an automatic price increase can be justified for any disruption in supply. Perfectly legal - US capitalism at work.

Wingmaster

Gee, why aren't we building more refineries then? Now doesn't that seem logical and a good investment?

How about allowing supply to increase? Now how can we do that....hmmm.

Lanivan

Gas and oil companies are not building new refineries because demand for gas in the US is at a 15 year low. And because they are investing in natural gas and renewable energy. Oh, and because if they build more refineries it would in effect be designing the industry to keep prices low - how silly is that!

Of course, we're paying double through our tax dollar oil and gas subsidies that have been awarded since the beginning of the oil industry - averaging about $10 billion annually, even though the Big 5 made $78 billion in profits in 2010, and $137 billion in 2011. An interesting factoid is that ExxonMobil paid NO federal income taxes at all in 2009.

Speaking of Bush, remember the Iraq War he started in 2003 to remove Hussein and WMD's to the tune of a couple of trillion+ dollars which we borrowed from the Chinese? (Absolutely not because Iraq sits on enormous oil reserves (wink wink)). Well, those same Chinese, who didn't contribute (directly) to the war are now benefiting from it, as they have just signed an agreement with Iraq making them Iraq's biggest customer!

But I read on some website this is all Obama's fault!

Wingmaster

Think you need to study and understand the principles of supply and demand. The supply is being screwed with therefore the price is going up artificially. Guess what happens when prices go up, that's right we cut back. There's part of your answer to less demand along with higher mileage vehicles (oh my now I will have to listen to how O single handedly forced auto makers into higher fuel mileage standards)

Now with high prices comes the opening for alternative energy to compete because it has no demand and the price is high to produce.

I'm all for alternative energy but not at the expenses of lowering my standard of living to pay for it.

The forces of capitalism and free markets are not at play here. All being played with by politicians, big oil, and foreign influences. Pick your devil! 35 yrs without a new refinery is just plain stupid. (Why can't the new refineries get built?) How would you like to be driving around in that unsafe VW bug still freezing your rear end off because some gubment agency says auto makers can't build new models or restrict building new models.

Unfettered, the free market would take care of this but then someone would not be getting votes or subsidies for their failed or not fully competent ideas.

Lanivan

And then there is the Oil and Gas Lobby that spent $140 million in DC in 2012 alone....

16damons

If anything, blame it on the responsible parties. Refinery malfunctions and all that BS are simple excuses. Michigan is a peninsula with a foreign country to the north. Unless Canada bound, gas delivery is a southbound turn around and accout. However, I would hope our state officials at least attempt to determine fact from fiction. Didn't Granholm instill a "Fuel Price Gouging" act about 6 years ago? What is considered "gouging"? LOL. One refineries' malfunctions can cause such turmoil? Lies. Tourism and capitalism are hand in hand.

Lanivan

The bill had more to do with gas station owners intentionally delivering less fuel to the tank than the pump indicates...http://www.michigan.gov/granholm...

Say no to new taxes

Gee, maybe if we weren't exporting gas overseas, supplies wouldn't be so tight?

Lanivan

Supplies are tight in the Midwest due to breakdowns and closings for maintenance of Midwest refineries...the rest of the country is not currently experiencing the shortages we are.

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