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Gas prices take dramatic hike

June 6, 2013
Stephen Anderson - DMG writer (sanderson@mininggazette.com) , The Daily Mining Gazette

HOUGHTON - Michigan gasoline prices are the second highest in the nation after suddenly spiking 31 cents in the last week alone, hitting an average of $4.23 per gallon for regular unleaded today, according to AAA Michigan's daily survey of 2,800 gasoline stations.

A year ago, gasoline was $3.67 in Michigan. A month ago, it was $3.76. Last week it hit $3.92 before skyrocketing to $4.11 Wednesday and up to today's $4.23 mark.

"Refineries in recent days have had production issues," Patrick DeHaan, GasBuddy.com senior petroleum analyst, said in a Daily Mining Gazette interview Wednesday. "They're coming out of maintenance with some problems. From my expertise it seems like it's a supply issue.

"The market is in 'controlled chaos' with refineries right now, and in Michigan there are limited options where it comes from."

According to Nancy Cain, spokesperson for AAA Michigan, the two primary refineries for the state are ExxonMobil near Joliet, Ill. and BP Whiting in Indiana.

"Both have been down for major maintenance issues," she said. "... Once these refineries are back at full production, prices should start moderating, so hopefully it's a temporary situation."

The current nationwide price average is just $3.63 per gallon, with Hawaii seeing the highest prices at $4.36. Michigan's $4.23 is second, followed by Alaska's $4.06 and then a string of other Midwest states: Illinois at $4.15, Indiana at $4.11 and Wisconsin at exactly $4. No other state has broken the $4 barrier.

"Breaking the $4 mark can always be an issue. I know it was a few years ago," said Tom Nemacheck, executive director of the Upper Peninsula Travel and Recreation Association.

The record-high state average was $4.25 on May 4, 2011. Locally, in Marquette, the closest metro area AAA tracks, the all-time record is $4.30 on May 13, 2011. Strangely, though, of all the locations in the state, the Marquette region's $4.16 average from today is actually the lowest in the state. Traverse City broke its all-time record today at $4.28.

"Is it unexpected? Yes. Is it unusual? Unfortunately not. It will probably get very, very close if not surpass record prices," DeHaan said.

According to Nemcheck, because the U.P. relies heavily on touring traffic, meaning people who drive to see attractions in several counties on one trip, there will likely be an impact, though he doesn't think in the big scope of trip expenses gas spikes should have a big impact.

"It will have a negative impact on the Upper Peninsula," he said. "... Logically, though, when you look at the whole trip, spending 20 or 30 cents a gallon more on gas, it isn't a whole lot compared to the whole vacation. Perceptually, we know it does change people's minds."

Julie Sprenger, who co-owns the Laurium Manor Inn with her husband Dave and is on several tourism boards doesn't expect the prices to damper an otherwise promising tourism season.

"I don't really think that it will make much of a difference for tourism," said Sprenger, who is the treasurer of the Keweenaw Convention and Visitors Bureau, a board member of UPTRA and on the state travel commission, as appointed by Gov. Rick Snyder.

"People are used to these prices," she said. "... It's something that does affect us, but it would have to be quite a bit for people to change their travel plans."

For more gas price information through AAA Michigan, visit fuelgaugereport.com, and for updated price listings at local gas stations, visit michigangasprices.com.

 
 

 

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