Gas prices on the rise; drivers not too pumped
Central Indiana’s gas-price break is probably over, thanks to a roughly 40-cent jump at the pumps over the past five days.Motorists at many filling stations were paying $1.84 for a gallon of regular unleaded Friday, a stark contrast to prices that ranged in the low $1.30s on Monday."Have we reached the bottom? The answer is a resounding ‘maybe,’ " said Peter Grossman, an economics professor at Butler University in Indianapolis. He thinks that given the price of oil and current market conditions, $2 could fast become the price.PUMP PATROL: Find the cheapest gas prices in town"You’ve got to pay the price that is out there, and that’s one thing people have to understand. It’s going to be volatile."Exactly one year after crude eclipsed $100 a barrel for the first time, 2009 trading began Friday with prices roughly half their year-ago levels. That’s reason to cheer, but oil markets also kicked off the new year with crude climbing above $46 a barrel — $10 higher than last week.A variety of factors were likely at work, including continued violence in Gaza and expectations that OPEC would carry out its largest production cut ever to stem historic price declines.At a Speedway at Washington Street and Emerson Avenue on the Eastside on Friday afternoon, drivers treated the increasing price with mixed reactions.One unhappy customer was Larry Russell, 58. The retiree said he sold a Cadillac and bought a Beretta because premium gas was unaffordable.Oil’s surge into triple digits for the first time a year ago was the start of a climb that peaked above $147 a barrel by July. Since then, amid fears of a prolonged global recession and crumbling worldwide demand, crude prices have plunged more than 70 percent.The average price for a gallon of unleaded on Friday — $1.70 in Indianapolis and $1.67 statewide — is still more than $1.30 cheaper than in January 2008.Indiana is 5 cents higher than the national average, and among the top 20 highest-priced states. Nationally, the average Friday was $1.62.Jennifer Siens, 20, Indianapolis, said her family has been increasing its nonessential trips as the price of gas dropped after reaching the $4 mark during the summer. “I just don’t want it to go to $3 or $4 again,” Siens said. “That’s what I’m scared of. Even when it was $2.50 a gallon, everybody was happy.”Nicholas Gerholdt, 28, Indianapolis, smiled as he put 10 gallons in his SUV. What he hates is the unpredictability. As he drove by the gas station a few days ago and it was under $1.40, he figured he had a half-tank and could wait a few days. That decision cost him 40 cents per gallon.“Missed out by 24 hours,” Gerholdt said.Demand could fall even further this month amid a U.S. recession and job losses reducing the number of people who drive to work, Grossman said.Scot Imus, of the Indiana Petroleum Marketers and Convenience Stores Association, said retailers haven’t been winning either, aside from cheaper gas prices freeing up more cash for drivers to come inside and make additional purchases.The association continues to lobby the state on changing the policies on advance payment of sales tax. He said they do their best to keep prices low but isn’t sure what the future will hold in terms of price swings.“It’s hard to tell,” Imus said. “It’s so dependent on crude.”Call Star reporter Tom Spalding at (317) 444-6202.
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