Gas price to climb by spring
Tribune Staff and News Services; The News Tribune
Even if war is averted in Iraq, South Sound motorists should be ready
to pay as much as a dime a gallon more for gasoline this spring.
And that doesn't take into account a possible war.
An Energy Department report Thursday forecast that because of rising
crude prices and the disruption to oil exports in Venezuela, gasoline
prices nationwide would increase an average of 10 cents a gallon by
On Thursday, the average price for regular gasoline in Tacoma was
$1.28, according to AAA.
Gas prices across the rest of the country are currently averaging
around $1.44 a gallon.
Oil and gasoline imports from Venezuela probably won't return to normal
before summer - if then.
Despite tight supplies of crude, the Bush administration gave no sign
Thursday that it was ready to use emergency oil reserves to soften
the supply or price impacts, although U.S. officials were lobbying
foreign producers to increase oil output.
"There's no change in the decisions that have been made,"
White House press secretary Ari Fleischer said when asked whether
the government's Strategic Petroleum Reserve might be tapped. He said
the purpose of the reserve was to respond to emergencies and implied
that no such situation exists.
The Energy Information Administration report said Venezuelan production
almost certainly will continue to be below normal levels into late
spring and into the summer driving season, even if the country's political
crisis is resolved in the next few months.
It would most likely take four months to return to full production
after the turmoil subsides, the analysis said.
Last year, Venezuela shipped about 1.5 million barrels a day of crude
and refined gasoline into the United States, about 13 percent of U.S.
imports. Its refineries, now largely shut down, also are a major source
of U.S. gasoline imports.
The EIA projections do not take into account the turmoil over Iraq
and assume that oil from that country will continue to be available
at about 2.4 million barrels a day. If war erupts in Iraq, all bets
are off on predicting prices, said EIA petroleum analyst David Costello.
Last year, Iraq produced about 2 million barrels a day on average.
Economists and energy experts have said serious worldwide crude shortages
could develop if war erupts in Iraq and the country's imports disappear
while Venezuela's oil fields remain crippled.
EIA director Guy Caruso said that "a positive sign" is that
gasoline inventories at this time are on the high end of the comfort
range and "in reasonably good shape."
The Associated Press and Bloomberg News contributed to this report.