Blog: Dermot Cole
Gas price gap grows
Published Monday, September 28, 2009
•A year ago the average gasoline price in Fairbanks was 53 cents above the national average. Now the Fairbanks average is 89 cents above the national average of $2.50 per gallon, according to AAA.
Gasoline in Fairbanks is 4 cents a gallon more than in Hawaii, 17 cents a gallon more than in San Francisco, 11 cents more than in Anchorage and 23 cents more than in Juneau, the AAA reports.
This month the 8-cent state gas tax, the lowest in the nation, was reinstated.
Nationally, gas prices are down by 11 cents from a month ago. In Fairbanks, gas prices are up by 13 cents over that period.
In the latest Lundberg Survey, gas prices ranged from a low of $2.16 in St. Louis to $3.29 in Anchorage. But that survey does not include Fairbanks.
For more on gasoline prices, go to http://www.fuelgaugereport.com
People can get togeather in this town to fight a nickel on a plastic bag. But circle the wagons and shoot inward when it comes to dealing with this fuel issue.
This is an interesting article Dermot. Many other states have a significantly higher sales tax on Gas, yet their overall price is lower.
We can fight bag tax because there are alternatives. We cannot/will not fight gas prices because we don't have a choice. At least I don't. I either drive to work or I move into town and walk.
any thing you pay extra for gas is less in a year than what your getting back on the 8th of oct. be grateful lets not be a bunch of wyners, got to have it. <"{{{>><
If we all lost weight (I'm over) we could save gas too
Ah, free market! Where would we be without you?
It astounds me how everyone so conveniently forgets that the local suppliers THEMSELVES last year said, basically, "Hey, there's no competition. We can charge what we want!"
And it always gives me a chuckle to see the same people who are adamant supporters of this kind of behavior are also the ones who bellyache the most about prices.
Yeppers, they got us over a barrel!
Thanks Dermot, good reporting here.....
I think what Chenasteamer is getting at, is that people in Fairbanks get alot more pissed off about the bag tax, than they do about the price discrepancy in gasoline. We all know it exists, and yet, nobody is screaming to high heaven. And everybody seem to trust the reports put out by politicians that its just market forces.
Well it didn't used to be this way...and the market hasn't changed much in 10-15 years. So what is it now. No oil company/refiner can give me a good excuse yet. At least not one I believe.
We pump it out of the ground here, we refine it here and we still pay more than anyone? Makes no sense. But the monopolies have got us and they know it.
And here I thought Sarah Palin, the great expert on gas and oil, was going to fix that problem when she became gov.. I guess she was saving that for her last year in office and, well, we all know what happened to that.
Face it, folks....Alaska needs the oil companies a lot more than the oil companies needs Alaska. Prices will stay high here as long as they want and there is never going to be anything really done about it beyond a lot of handwringing and gnashing of teeth. Prudhoe Bay is assuming less importance in the scheme of things as they approach the end of its production life; ANWR is too expensive to explore and develop (and I have been told that by someone working on the Slope for over 30 years in that exact area of expertise); and they are finding new sources in the Lower '48 near transportation and refinery facilities that are already in place. We're yesterday's news.
Better start investing those PFD's in something reliable and productive because the curtain is slowly coming down and it's gonna hurt like the devil when it finally reaches bottom.
Don't worry. Jay says everything is above board...
No wonder we're seeing more "small cars" around Fairbanks these days! The only problem is when they slid off the road
into a snow drift, you won't be able to find them!
Well, I can't say I'm terribly impressed by Jay's response to the situation, either. But, then, I'm not impressed by anything our legislature has done to address the problem. Like I say, they seem good at commiserating with us and wailing just as loudly but when it comes to actually putting the thumbscrews to the industry up here suddenly everyone has something else to do...a meeting to go to or some papers to sign.
Face it...Alaska is a petrogarchy.
last week I bought gas in wasilla..more expensive than here..also anchorage...and Soldotna even more...let's not even talk about the price of gas in Valdez.
People have quit screaming about the price of gas because they are tired and have resigned themselves to the belief that we can't do anything about it. If the bag tax actually goes into effect in January, people will cry about it for a month or two and stop compaining about it too. I cuss the oil companies everytime I pull up to the pump, but until everyone decides to significantly cut back on their driving and send the message that we won't pay what they are asking, the price will remain high. I understand everyone has to drive to work, but that's not the majority of the driving that most people do. The amount of traffic in the evenings and on weekends proves that. If people would just organize and cut back for a month prices would drop. It's time to stop relying on the legislature to do something about it. They aren't going to bite the hand that feeds them. They have proven that with bogus investigation after bogus investigation. If you want to make a difference, take action and park your darned car. Plan and consolidate your trips. You'll be amazed how much you can save with very little effort.
Time to 'Sig' the dogs on the GREEDY Fellows .. run them up a tree .. or a tundra bush. Yep, lots of laws on the books about price gouging, monopolies and down right rascals .. we just seem to surplus of toothless dogs that want to be pampered.
AKbychoice,
This isn't going to work. There will always be someone somewhere willing to buy the gas that you won't.
The only way to get to the bottom of this is to write laws that demand justification and transparency for the way gas prices are set. And then holding accountable with fines and jail time for those who don't comply.
But we have to start with holding our politicians, the ones we entrust authority to run such investigations, accountable.
Until we are satisfied, they haven't done their job. Period.
free market economy..don't like it ..don't live here.
start your own gas station, sell lower, take over.
Free markets are some kind of joke really. Mostly what I see is everyone price fixing as high as they can. It is not the way to a stable economy and is a disaster except for the people who get to do the price fixing. What does speak is protest. They can bend us over like big dogs with gusto and if we aren't fighting back well that is permission. Think we have no choice? Lets all go on down to the local refinery this weekend in protest. About 30,000 of us should be an attention getter. Believe me the sight of a veritable sea of pissed off Alaskans surrounding their ratbag facility would be good start towards some reasonable prices. We are not dealing with a bunch of nice guys so why be nice?
A little national attention would be a great place to start.
Big part of the problem is that the refinery uses oil as feed stock rather than natural gas, which is what most of the country uses and is much cheaper.
...and what is up with North Pole? 20 to 30 cents more a gallon. Fuel is cheaper in Salcha and about the same in Delta. I realize there is a sales tax but come on. Even though I live in NP I never fuel up here.
North Pole is the pits and everyone knows it- if you supply the bulldozer I will supply the fuel!!
sosorry has it right, absolutely. A few thousand pissd off Alaskans picketing at the refinery, maybe at Jay's house, out to get somebody's notice. National news? Naw, nobody in this state gives a hoot and holler about national news except Sarah, and she's not even in Alaska since she turned into a quitter and just writes fantasy novels.
Unfortunately, chenasteamer is as right-on as sosorry. That means nothing will be done to get any attention except a few comments here. Sad that this town is full of mumble-mouthed pansies who take it lying down.
Dobieman
In support of your statement about oil in the lower 48 google either Bakken oil reserves or Williston basin.
import gas from russia :P
that price gap is down right insane and almost verges on criminal
It's all the Legislaturs fault. There no price gouging so they say.... LOL.. all are taken to cleaners, by the well lined pockets of AK Gov't. There simply is no other excuse.. Simple greed on the from the slope, to refinery, to the distributors.. to the stations the you get your fuel from.
The sells your royalty oil to the refineries at a $60 profit per barrel.
The cost to the reifineris is passed on to you as high price.
It is my understanding low surfer diesel is imported from Seattle to improve "Air Quality"
Ride the bus. I decided last month to try riding the bus for 30 days. Guess what? It works. I get home from work within 10 minutes of when I used to drive. The bus stops at the corner of my street and delivers me almost to my work place. It's convenient, dependable, safe, the drivers are professional, and friendly. I save money in parking, wear and tear on the truck, and most of all on gas. I haven't bought gas in a month and still have half a tank.
This is ridiculous. 4wutitsworth may have the right idea. Get enough folks together to shut it down for a day. I burn much less then ever but feel the price we pay is outrageous.
Pat
Not driving for a day/week/month won't do anything at all. Even driving smaller cars won't do anything to the oil companies, unless a VERY large portion of the population participates, and actually DOESN'T drive needlessly. All this will do is RAISE the price of fuel on what we do drive in order to make up for the loss of revenue. Its really just as simple as that.
Alaska needs the State to invest in the infrastructure to enable distributors to bring in economic quantities of fuel in from the world marketplace. A state owned tank farm at the Port of Anchorage would break the Alaska refinery oligopoly and allow competition at the wholesale level. Econ One estimated the cost of importing refined fuels from terminals in Washington State would be around 8 cents per gallon. A relatively small investment by the State could free Alaska from high fuel prices indefinitely.
Why must the State do it?
The risk and reward for the private sector is too great. To build a facility at the Port of Anchorage long term leases would need to be signed and the refineries have the ability to cut costs in the short term making such a capitol venture extremely risky. To quote a local Fairbanks fuel distributor, “There is no way for an independent such as myself to import any real volume from the PNW (Pacific Northwest), I have no access to storage thus no way to bring enough in to make a meaningful difference in the market and the risk exposure is huge the refineries could make it an unprofitable load in the blink of an eye.”
Without outside intervention it is highly unlikely that this situation will correct itself. All three refineries are enjoying profitable margins and there is no incentive for them to increase the level of competition in the market. Unless the legislature acts we will continue to see higher prices indefinitely.
www.fairbanksgas.com
The problem is not with big oil, the problem is with the refineries. The refineries are being sold Alaska royalty oil below the OPEC spot price. This means they are getting oil at a discounted price. Combine this with the fact that the refineries have next to no transportation cost for their product and Alaska having the nation’s lowest gas tax and we should be well below the national average.
Fairbaksgas is right. The state has to open up competition by building a tank farm. Without competition the refineries have no incentive to reduce their prices. Remember HI pays less at the pump than we do even though they pay 3X more tax and have to ship their oil across the Pacific.
Needed that gas line 5 years ago. The refinery does not have any other fuel for the refinery. Yes all of the other stuff applies but being a small market and getting smaller. What with the railroad cutting back, tourism in decline. Back to our frontier roots. The silver lining could be less pollution as we move back to a community of 40,000.
Let's see. Oil get pumped out of public ground on the North Slope, piped to all over the world instead of anywhere in the USA. Refined gas is shipped back to Alaska. It costs a lot of money to transport refined products to Alaska. Any refineries in Alaska? No wonder gas like everything else has to be shipped in. Why not make things in Alaska and build refineries in Fairbanks and Anchorage.
OMG gas dropped a whopping 4 cents today :O :O
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