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Rising cost of filling tank likely to climb even higher

By Glen Creno The Arizona Republic April 25, 2001 12:00:00

Frank Woodiuk may be looking for a new car if gas prices keep zooming higher.

The Mesa contractor drives about 100 miles a day in his big Suburban sport utility wagon, but filling the tank is getting pricey. If gas hits $2 a gallon, Woodiuk is going shopping.

"The hell with it," he said. "I'll sell it."

Woodiuk isn't alone in his frustration. Valley drivers are growing increasingly irritated about rising gas prices and trying to decide how to fight back.

Some are eliminating jaunts across town to visit friends. Others are changing vacation plans or griping about the gas guzzlers produced by carmakers.

And there are plenty of folks like Bernie Starikoff who seem resigned to the fact that prices will head higher. "You blink your eyes really, and it's up 13 cents a gallon," the 71-year-old Phoenix scrap-metal seller said.

AAA Arizona says the average price for unleaded self-serve gasoline in Phoenix stood at $1.49 in March, hit $1.57 the middle of this month and is still rising.

Analysts and oil industry experts say any number of forces can move prices at the pump. They say the companies now run with lean inventories, magnifying any disruption in the system like this week's fire at a Tosco refinery in California.

Other forces at work: Cleaner-burning additives that save the air but boost prices, a perceived lack of refining and delivery capacity, fluctuating crude oil prices and refinery maintenance, reducing supplies.

"It adds up to a pricey picture," said Tina Vital, an oil industry analyst at Standard & Poor's in New York. "We're going to see it this summer, and we'll probably continue to see it for a while."

Vital expects gas prices to hit $2 a gallon this summer in some U.S. cities, matching last year's spike.

Oil companies dislike talking about gas prices or predicting where those prices might be heading. Tosco, the big refiner whose Tempe division runs the Circle K stores, was stung in recent weeks by accusations that it led the local market higher.

Spokesman Clark Wrigley wouldn't say whether the accusation had merit. "There's a marketplace there, and the marketplace will operate," he said.

Paul Langland, Los Angeles-based spokesman for BP, which runs Arco, said it would take something drastic to produce $3-a-gallon prices. "I don't think there's anything normal about this business," he said.

One thing that baffles drivers is the variety of prices in a big urban area like the Valley, where the cost of a gallon of unleaded regular can vary by more than 20 cents from one station to another. On Tuesday, prices in west-central Phoenix were as low as $1.48 while prices for the same product in Scottsdale were $1.68.

Debra Margraf, head of the trade group that represents independent gas stations, said that's due to so-called zone pricing.

She said the policy lets companies vary the price according to demographics and competition. Margraf complains that consumers lose when big oil companies that also run convenience stores use their muscle against independents.

When prices take off, consumers can pay up or drive less.

Scottsdale resident Dwayne Nahorodny is choosing the latter. Before prices rose, Nahorodny wouldn't think twice about taking his family for a drive. But times and prices have changed. "Now there's a thought process of spending $30 and back just to go and show my daughter the mountains."

Les Gorman, a carpenter who commutes between Phoenix and Mesa every day, said a couple dollars doesn't put much in the tank these days. Sitting in the family's Ford Aerostar on Tuesday morning with his wife and five children, Gorman said he doesn't have many options in choosing another vehicle. "Most times, what I earn goes mostly to gas," he said.

Sherry Pozzi, a 59-year-old Glendale nurse assistant, said that with gas prices soaring, she'd like to trade her 1969 Chrysler LeBaron for an electric or alternative-fuel vehicle, but prices for those vehicles are too high.

Reporters Bruno J. Navarro, Ashley Bach and Stephanie Miller contributed to this article.

-- Martin Thompson (, April 25, 2001


But they keep buying new SUVs. There will be so many gas guzzlers for sale by mid summer. I don't know where they all think they are going to sell them. I would LOVE to have one, but I drive an old 89 Taures that gets good milage and only has 60k on it.

-- Taz (, April 26, 2001.

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