Gas prices rise and stress local budgets

Jack Keevill, a 79-year-old retired school custodian and maintenance man, receives one pension check each month, worth less than $700. The Millville resident said he sometimes depends on friends and family members to cover bills and everyday expenses.

Rising gas prices are especially troubling to someone like Keevill and many other retirees in the area living on fixed budgets, he said. While filling up his small pickup at a 139th-street 7-11 in Ocean City, Md., on Tuesday, Keevill called current gas prices “terrible and outrageous.”

“When you get on pension a month, you have to learn how to live on it,” Keevill said.

As of Tuesday, with prices sitting at $2.88, Delaware’s average price for a gallon of regular gas had risen 11 cents in a week and 25 cents in a month. Tuesday’s price is still 4 cents lower than the average of one year ago, but is the result of the latest extreme fluctuation, which has become the norm in recent months.

The BP on Route 1 in Bethany and the Fenwick Island Citgo showed identical prices of $2.89 Tuesday, the lowest observed along the coast early this week. Their prices were still 8 cents pricier than just down the street at a 142nd-street Exxon in Ocean City and 14 cents more expensive than at the 139th-street 7/11.

An Exxon station on the south side of Route 54 between Fenwick and Selbyville showed prices of $2.99 Tuesday with a nearby BP station selling regular for $2.95. Hocker’s on Route 26 near Millville sold regular Tuesday for the similar price of $2.96.

Ela Voluck, a AAA Delaware spokeswoman, said she expects prices to near $3 before the summer but predicted they will level off through the summer and not come close to $4.

An AAA report issued last week rebutted reports that gas prices would reach $4 this year. Prices hit $3.12 per gallon of regular on July 18, the most expensive average recorded in the state last year. A $3.23 Delaware average recorded on Sept. 7, 2005, still holds the record and was the result of extreme production halts and shortages after Hurricanes Katrina and Rita devastated the Gulf Coast region.

“It would take catastrophic event to get us to that level,” Voluck said. “A lot of refineries are experiencing outages and are not producing as much. Demand is strong and refinery output is not keeping pace.”

Doug MacIntyre, a senior oil market analyst with the Energy Information Administration – the statistical arm of the U.S. Department of Energy – agreed that refinery outages and production hiccups are causing the current spike in prices nationwide.

The national average sat Tuesday at $2.97. MacIntyre expected the national average to eclipse $3 in his agency’s weekly report Monday. Domestic inventory levels are at their lowest April level since 1991, MacIntyre said. He seconded AAA’s stance, though, that prices will not reach $4.

“When you don’t have a lot of something, it makes those that have it price their product higher,” MacIntyre said. “They’re going to price it for what the market can bear. We liken it to selling a house. If you can sell it for a greater profit, you will.”

Such capitalistic explanations seem to frustrate the previously-mentioned 79-year-old retiree, who said “nobody’s done nothing” to help him bear the costs.

Keevill filled up in Maryland on Tuesday out of convenience; he was visiting a friend nearby. Keevill said if prices continue to rise, he plans to purchase gas over the state line in Ocean City more often, where vendors are not subject to state governmental requirements to use alternative blends, such as ethanol.

Such mandates are in place in Delaware — where vendors are required to use a 10 percent ethanol blend — and in 13 Maryland counties, but not on Maryland’s Eastern Shore. Lower prices in the Maryland beach town often tempt Delaware residents to drive an extra couple miles to fill up there – especially when prices rise, as they have been recently.

“I do come and get gas (in Ocean City) every now and then,” Keevil said. “If it gets too high, I would come down with a half of a tank.”