Gasoline prices likely on upswing

The downswing in Utah gasoline prices may be over.

AAA Utah said Tuesday that Utah's average gasoline price was $1.63 per gallon, 2 cents more than a month ago, putting a halt to monthly price decreases dating back to July.

The organization described the increase of nearly 20 cents since Christmas as "very troubling." In late December, the average price per gallon dipped to $1.45.

"The commodity market is just so incredibly volatile, and it seems to react to many forces you wouldn't even think would impact it," said AAA Utah spokeswoman Rolayne Fairclough.

"Right now, from what we know, we have healthy inventories and demand is down. Even though OPEC cut production levels after a brief foray at the high $40 level ... we're seeing low oil prices, low demand and high inventory, so we should be seeing lower prices right now," she said. "We also know that the producers will be limiting production to try to match the inventory more with the demand."

The result of those factors could be higher prices in the spring, augmented by the weather growing more conducive to driving.

"Barring unforeseen circumstances, I would suggest we would be probably following a normal trend this year when we see prices increase in the spring," Fairclough said. "We shouldn't see increases right now, but we should see them in the spring and then into the summer months, as well."

Demand, however, appears to have leveled. "All of those habits that people put into place this summer to try to control the costs are still in place. People are maybe not so concerned about the price of gas, but they're still concerned about their personal budgets, so they're trying to be very frugal," she said.

AAA Utah surveys a handful of communities across the state. Individual gas stations sell fuel at higher and lower prices. AAA's report focuses on self-serve regular gas without regard to octane level.

Salt Lake City and Provo both had average prices of $1.60 on Tuesday, up 5 cents from last month. Vernal had the highest price, $1.70, down a dime. Moab's price fell 31 cents to $1.58. Ogden's average of $1.59 was up 7 cents. A gallon in St. George averages $1.61, down 4 cents. Logan saw an 8-cent drop to $1.63.

Surrounding states have varied prices. Wyoming's average is $1.46, down 14 cents, while Montana's slipped 18 cents to $1.49. On the other end of prices, Nevada motorists are paying $1.93, or 9 cents more than last month, while those in Arizona are forking over $1.74, the same as last month. The average in California is $2.01, or 21 cents higher.

Utahns still pay less than the national average, which was $1.79 on Tuesday, down 9 cents since December and down $1.28 from a year ago.

"In the short term, we are seeing prices going up, but not necessarily all over," Fairclough said. "People should really be aggressive in shopping for the lowest prices, because they are around. I was at an intersection, and at one corner, the price was $1.45, and across the street, it was $1.60. It's not always that blatant, but there are deals around, and people should look for the lowest price that they can get."

AAA's Gas Price Finder, with real-time information about prices at more than 85,000 stations in the country, is at www.aaa.com/gasprices.

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E-mail: bwallace@desnews.com