High gas prices return to Michigan

By James Restivo

For the Daily

After a summer of high gas prices, LSA sophomore Joanna Bluestone said the current cost to drive is "ridiculous." And it's getting worse.

After prices leveled off last month, the cost of gas is now on the rise again - at $1.60 to $1.80 per gallon, according to AAA Michigan.

To Bluestone, the higher prices are limiting her travel.

"Since I'm from out of state it limits trips home to Chicago and so I see my parents less," she said.

Gasoline prices could pose a problem for students who plan to drive home or around Ann Arbor in the near future.

John Griffin, executive director of the Association Petroleum Industries of Michigan, said the price increase can be tied to supply and demand.

"Crude oil at $35 per barrel is at the highest in 10 years and gas reserves are depleted all over the world," Griffin said.

Griffin, whose company works with about 400 companies in the state that deal with the production and consumption of gasoline, said forecasting the oil market is difficult.

"We cannot predict the future, no one knows for sure," he said.

An additional factor in the fluctuation of gas prices is competition, Griffin said. When local markets are competing fiercely against each other for business, prices decrease.

Griffin said Ann Arbor's affluence could contribute to local gas prices. Since property values and labor costs are higher here, those expenditures translate into more money being shelled out at the pump.

AAA Michigan spokesman Larry Keller said a large part of the oil shortage is due to reserves being stored for winter and low production output by members of the Oil and Petroleum Exporting Countries in the past few months, despite plans to increase. In states like Michigan, heating fuel costs this winter will determine what consumers pay for gas.

Some of the student-dependent taxicab companies in Ann Arbor are having problems because of the price of gasoline.

Charles Frey, general manager of Veteran's Cab Company, said he has a shortage of drivers willing to pay for gas and that soon could be factored into a surcharge to alleviate costs.

Stephanie Brugler, an Education graduate student, said she has noticed the gas price increase but it hasn't been severe enough to affect her.

"It may reduce frivolous trips," Brugler said.

Gasoline is simply a expenditure she factors into her budget like food and rent, she said, and until gas prices decrease she will search for the cheapest gas in town.

Among two of the lowest gas prices in Ann Arbor yesterday were the Amoco station at 2995 Packard St. and the Ann Arbor-Saline Road Meijer gas station, where prices were $1.67 per gallon for regular and $1.87 per gallon for premium.

Additional information on the status of gas and future price estimates can be found online at www.aaamich.com and www.eia.doe.gov.

PETER CORNUE/Daily

Ann Arbor resident Paul Rosaco pumps gas yesterday at the Clark station at South Main and Madison streets.