Higher fuel costs inevitable, but explain price variations

Published 5:00 am Tuesday, October 25, 2005

After a spike in recent months, gas prices have, thankfully,begun to subside over the past week.

As of Tuesday, the nationwide average for a gallon of regularunleaded had fallen below $2.75. In Brookhaven on Friday, priceswere seen as low as $2.44 per gallon. Considering that per-galloncosts topped $3 in the days and weeks after Hurricanes Katrina andRita, the dip is welcome news indeed.

We know gas prices are volatile, reacting to world events,supply and demand and other triggers. But wide differences inprices from city to city leave us scratching our heads.

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Traveling last weekend, DAILY LEADER staff members noted quite adisparity. While regular unleaded here at home was selling foraround $2.75 a gallon, stations in Kansas City were selling it for$2.39 a gallon, while many Birmingham pumps were priced no lowerthan $2.82.

Why such a difference? While the public may understand thatprices rise, we’re just not so understanding of price fluctuationsfrom region to region. There may well be a valid reason, but if so,why has no one from the energy industry ever bothered to tell us,to explain the factors that make fuel cost far less in the Americanheartland than in Mississippi, Alabama and Louisiana, all situatedoff the same Gulf of Mexico from which so much of the oil isderived.

In much the same vein, a simple explanation of how an earthquakeor tornado yesterday raises prices today when the gas we’re buyingis already refined and available would go a long way.

We’re told the higher cost of energy – from heating oil tonatural gas to gasoline – is something we better get used to. Sure,we don’t like it, but we might be just a little less prone togrumble if someone would just explain why.