An attack on Iraq is not the only thing Utahns have watched with astonishment the past two days. Gasoline prices have either stayed the same or gone down.
The average price of unleaded regular at 10 service stations in Salt Lake County on Friday showed no change. At some stations, prices have actually dropped a penny or two.So, why did the threat of war send pump prices so high last August and September, but the real thing produces virtually no reaction at all?
Oil companies have answers:
- In August arrangements weren't in place to make up for the 4 million barrels lost to world supply by embargoing Iraqi and Kuwaiti oil.
- Saudi oil fields weren't as secure against possible Iraqi attack.
"Panic buying was fueled by the unknown," said Jim Peacock, executive director of the Utah Petroleum Association.
The price escalation lasted about two months. Since then, Saudi Arabia's increased production has replaced Iraq's and Kuwait's embargoed oil, world economies are slumping and the seasonal demand for gasoline has dropped. It's all forced prices at the pump to decline - albeit slowly.
But the possibility of sky-high fuel prices still existed before fighting broke out late early Thursday in the gulf. Local refineries were poised to implement allocations and price freezes to prevent hoarding of fuel.
"If a shot is fired, it will go out of sight," a paranoid executive director of the Utah Petroleum Retailers Organization, Paul Ashton, said earlier this week.
Traders had to look down, not up, for the closing cost of crude.
The success of the first military strikes on Iraq and President Bush's announcement to tap into the country's Strategic Oil Reserve sent prices plunging $10 a barrel Thursday to $21 a barrel - an unprecedented swing from the $38 a barrel fetched when reports of war were first heard.
Early Friday crude oil prices were up slightly, but still hovered around the $20-$21 range.
But don't expect pump prices to drop as fast, Ashton said, noting many retailers bought fuel last week for $1.10 a gallon and will have to break even on those shipments before lowering prices very much.
"It's still business as usual for a week or two, but if if it remains low it will come down in small decreases. Competition will slowly bring it down."
Here's a sampling of prices for regular unleaded gas in Salt Lake and Utah counties as of Friday morning.
SALT LAKE COUNTY
379 S. 300 West 1.109
877 S. 1300 East 1.159
1006 E. 2100 South 1.199
7210 W. 3500 South 1.109
3901 S. Wasatch Blvd. 1.189
2995 E. 7000 South 1.139
1931 E. Fort Union Blvd. 1.119
1316 W. 9000 South 1.119
111 W. 10600 South 1.129
10416 S. Redwood Road 1.119
90 N. Main, Payson 1.269
833 N. Main, Sp. Fork 1.269
500 N. 200 West, Provo 1.259
430 W. 1230 North, Provo 1.259
800 N. Canypon Rd., Orem 1.249
SALT LAKE COUNTY
Average price last week 1.139
Average price this week 1.139
Average price last week 1.289
Average price this week 1.261