Gas prices continue to spike - East Valley Tribune: News

Gas prices continue to spike

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Posted: Tuesday, August 12, 2003 11:13 pm | Updated: 1:05 pm, Thu Oct 6, 2011.

A shutdown of the gasoline pipeline between Tucson and Phoenix — with no date for its reopening — continued to push gas prices higher Tuesday in the East Valley.

In the south East Valley, the average price for regular, self-serve unleaded gas jumped 4 cents from midnight Monday to $1.59 per gallon as of 12:01 a.m.

Tuesday, according to the Oil Price Index Survey. In Scottsdale, the average price spiked 5 cents to $1.66 per gallon during the same 24-hour period. The average increase statewide was 4 cents.

The increases came in spite of assurances from pipeline company Kinder Morgan Energy Partners that there are adequate supplies to meet demand in the Phoenix and Tucson areas.

Scottsdale resident Jack Nugent noticed the price hike after filling up his car on Tuesday. "Oh, yipes," the 80-year old said, his eyes widening. He said he had heard about problems with the pipeline, but wasn't sure if he believed it. "They love an excuse," he said, laughing.

The mood wasn't as light at some East Valley gas stations, including a Mesa Mobil station at Mesa Drive and Southern Avenue, which ran out of some blends of gas. The Mesa station ran out of mid-grade, 89-octane unleaded gas on Saturday, and premium, 91-octane gas on Monday, said manager Robin Lavine. A manager at an am/pm station at the same intersection said his station was experiencing a gas shortage, but wouldn't comment further. By Tuesday evening, several stations in Scottsdale, including Sam's Club and Costco, were out of all grades of gas. A Texaco at Mesa Drive and Broadway Road had yellow tape on several of its pumps, including all of its 89-octane ones, but assistant manager Tina Harrison said the pumps were simply not

working.

"We're not having a gas shortage whatsoever. We're just having broken pumps," she said. ARCO spokesman Dan Cummings said about half of the Valley's 77 ARCO stations have had temporary shortages of gas as of Tuesday afternoon. The shortages have been more common in premium and mid-grade unleaded, because those products come from the affected pipeline, but some stations have also run short of regular unleaded, he said.

ARCO is trying to meet customers' demand while keeping prices as low as possible, but the main challenge is not knowing when the pipeline will be back in service, he said. The higher prices at the pump stem from the higher cost of trucking the fuel, as opposed to getting it from the pipeline, and unrelated increases in the price of crude oil, Cummings said.

The problems with the pipeline began July 30, when the eight-inch line from Tucson and Phoenix ruptured. The line, which typically supplies 30 percent of the gasoline, jet fuel and diesel fuel to the Valley, began operating on Aug. 1 at reduced pressure but was shut down on Friday Aug. 8 after tests showed that a pipe defect had caused the rupture.

While the line is shut for further testing, the company has increased the amount of gas it transports through its other pipeline, which comes via Los Angeles. The Los Angeles pipeline will bring in 85 percent of the supply (instead of the usual 70 percent) and the remaining 15 percent will be trucked in from Tucson, Kinder Morgan spokesman Rick Rainey said.

All pumps were operable and stocked at Texaco at Mesa Drive and Southern Avenue in Mesa, but service writer Gary Kunkel said he wasn't sure if that would last.

"For all I know, we might have a shortage today, because we need a delivery in each tank," he said. He wasn't sure when the next delivery would come. "They just deliver when they see fit," he said, noting that the station no longer does its own ordering, but relies instead on orders from headquarters.

That ordering system has slowly changed over the years. "One place orders gas for all the stations," he said. "If we run out, we run out. I ain't worried," Kunkel said. Gerry Tedrow, executive director of the Western Petroleum Marketers Association, said he didn't expect shortages or high prices to last long, but that would depend on how soon the pipeline is fixed.

"The chances of it being fixed soon are pretty good," he said. "It will work itself out."

Most people keep their gas tanks less than half full, he said. "The worst thing is for everyone to go out and fill their tank. Just that action could create a shortage."

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