Area gas prices top $4 a gallon; low supply to blame

Area gas prices top $4 a gallon; low supply to blame

CHAMPAIGN — Gas prices in the Champaign-Urbana area hit their highest point ever Friday, shooting past the $4-a-gallon mark.

But an industry analyst said consumers may see a little relief within days.

By midday Friday, many gas stations in Champaign-Urbana were selling gas for $4.19 a gallon, up about 20 cents from Thursday.

The average price in the Champaign metro area was $4.14 a gallon, according to GasBuddy.com, which monitors gas prices across the nation.

"The prices you're seeing today (in Champaign) are the all-time record-high," said Gregg Laskoski, senior petroleum analyst for GasBuddy.

The high prices come as the result of shutdowns at five Midwestern refineries, and the effects are being felt throughout the Great Lakes states, Laskoski said.

On Friday, Chicago had the highest gas prices of any metro area in the nation — averaging $4.46 a gallon, still shy of the city's record high of $4.56 set in March 2012.

The cities with the next highest prices were: Gary, Ind.; Lansing, Mich.; Grand Rapids, Mich; and Flint, Mich., followed by Honolulu.

"Any time you have cities with prices exceeding those of Honolulu, that's a problem," Laskoski said.

He said the problems stem from:

— An extended shutdown at an ExxonMobil refinery in Joliet.

— An April explosion and fire at a Marathon refinery in southwest Detroit.

— Reduction in output from a Citgo refinery in Lemont.

— A BP refinery in Whiting, Ind., operating at only one-third of capacity due to a long-running expansion project.

— Slowdowns at a Phillips 66 refinery in Wood River.

Laskoski said gas prices in Indiana and Michigan dropped a penny from Thursday to Friday, which could be a sign prices are topping out.

But he said it's difficult to say when prices will decline here.

"I'm cautiously optimistic that it will be days and not weeks, but realistically it could be another week or two," he said.

Prices were averaging $4.18 a gallon in Indiana on Friday, and $4.23 a gallon in Michigan, he noted. The U.S. average was $3.64 a gallon.

Several metro areas just outside the Great Lakes states had prices significantly lower than those in Champaign-Urbana.

Gas in the St. Louis area, for example, was selling for $3.29 to $3.41 a gallon, while Louisville, Ky., stations were selling it for $3.39 to $3.57 a gallon.

A few places within a couple hours' drive of Champaign-Urbana still had prices below $4 a gallon Friday, according to GasBuddy.com. Springfield stations had gas for $3.89 to $3.99 a gallon, while prices in Effingham ranged from $3.77 to $3.99.

At the Murphy USA station on North Prospect Avenue in Champaign, several motorists ducked in Friday afternoon to take advantage of one of the few places locally selling gas for $3.97 a gallon.

"We just came back from Alabama on Tuesday, and every state between here and Alabama is considerably cheaper," said Carol Baine of Urbana, as her husband, Jeff, filled up their tank.

She said they saw prices as low as $3.12 a gallon on their trip.

Richelle Gentry-Flemons of Champaign made a beeline for Murphy USA after picking up a friend from an Urbana hospital.

"I drove like 100 (mph) to get gas here before it changes," she said after buying $75 worth of fuel.

Jackie Jones of Saybrook said was relieved to find a $3.97 price posted in Champaign after seeing gas advertised for $4.09 in her McLean County community.

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Orbiter wrote on June 08, 2013 at 8:06 am

It's gouging, pure and simple.  Anyone who's lived in the CU area for a few years knows how the gas stations all raise their prices on Thursdays before any significant event at the U of I.  And they all do it in concert--it's collusional.  I don't buy for a moment that all the refineries are now having low output by coincidence.  It's market manipulation.  There's something fishy going on, and it stinks.

If we're to believe that this is honestly just coincidental factors affecting output, then it's time they built a few more refineries.  Speaking of which, with all these refineries here in the midwest, why on earth do they need to build a pipeline all the way to the Gulf, to deliver oil from Canada?  Why not just refine it here--clearly we have the need.

Nice Davis wrote on June 08, 2013 at 9:06 am

"Gouging" implies that the gas companies owe the community gas at a low price instead of a market price. Guess what? They don't. "Low supply" may be to blame, but we can also control our own destiny in this arena by lowering our demand for gas as well.

The sense of entitlement people have towards cheap gasoline always amazes me.

lebloom wrote on June 08, 2013 at 9:06 am

"Low Supply"  yeah right.  They can make up any excuse to gouge us with this stuff.  And all in Washington just sits back and acts Stupid.

shurstrike wrote on June 08, 2013 at 10:06 am

"Low supply".....hogwash.

They always seem to come up with some reason why our gas prices jump, but none seem to make any sense.

Low supply?  Is the supply any lower here than it was south of Effingham yesterday when I saw gas for $3.65 after having left CU where the prices were $3.99?   The answer is no.  When I got home my jaw hit the ground when I saw that Thorton's was $4.19.  Same supply - $0.54 difference.

Face it, we're on "an island" here.  The majority of the people who live in CU work and spend most of their time here in CU, so we're stuck.  No one is going to run to another metro area just to gas up, and they know that. so they charge whatever they want and we just keep sucking it up. 

Nice Davis wrote on June 08, 2013 at 11:06 am

Dooesn't your "island" theory equally apply to Effingham and points south? How do those drivers have any more choice in buying gas than we do?

shurstrike wrote on June 08, 2013 at 9:06 pm

Not necessarily.  Effingham, Mattoon & Charleston, are all moderately sized communities with larger commuting populations between them than we have here.  As a commenter above stated, Mattoon's gas was still priced significantly lower than CU's, and likely for good reason. I was just in Monticello this afternoon - a town with a much higher percentage of the population working outside of their community than CU - and their gas was still $3.99.

*edited because the comment string stating that gas prices in Mattoon are $3.80 was removed.  Not sure why, but they're gone.

avieira wrote on June 09, 2013 at 6:06 am

I am gonna second most here about how our area (which in the big biz world is somehow considered great Chicago market) has significantly biased gas prices. It has nothing to do with sense of entitlement, or anything like that. I just went to Doyle, TN and back. Left Champaign with $3.99/gallon, in Effingham drove past stations posting $3.35. By the time we hit Kentucky it was down to $3.28, and then in TN we saw $3.10-3.15. 

So, yeah, we do get slammed over here.

Danno wrote on June 12, 2013 at 12:06 pm

'Price Gouging' is a subjective perception; it does not exist on a local retailers level, as many recieve their supply from different sources. To prove that would require demonstrative legal proof 'collusion amongst retailer, distributor and, supplier'. It has occurred, though rare for whatever reasons. It is not 'coincidence' either. Gasoline is a worldwide commodity; all nations demand more, especially, e.g. China. Parts of the world drill/get 'light' crude oil. It requires less refining. Other parts, 'heavy' crude that requires more refining processes ($$$). In the U.S., per Government regulation, all refineries must meet EPA regs' and refine a mix per metropolitian/regional/rural 'defined standards' per for whom they supply. And, four times per year, they all shut down to re-tool their production lines (cleaning storage tanks, pipes, 'distillery' tanks, etc.) per EPA Regulations. They don't just flip the 'ON' switch; it takes awhile for a refinery to reach operating efficiency. Repeat process in the Fall, again in Winter, again in Spring, again in Summer, etc. Think about 'collusion', low supply, 'coincidence'.

danrice56 wrote on June 13, 2013 at 1:06 pm

We live in a community that has a bus service, taxis, and most things within walking or biking distance.

Cars are great, I drool over ones I see at dealerships I pass all the time.

 

But the expense is not worth it to me.

 

If you do not absolutely have to have a vehicle, might I suggest you cut the cord and rid yourself of it?

 

Perhaps you'll decide the expense isn't worth it to yourself, either.

cretis16 wrote on June 13, 2013 at 4:06 pm

I remember when gas broke $3.00 a gallon with Mr. Bush...the National News went into hysteria mode on Bush and his oil buddies hittin the populace. Diane Sawyer did a nightly news segment from a gas station talking about the pain and suffering these prices were causing. And today......$4.00++ per gallon?...Shhhhhhhhh.......