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Gas prices set records in Lincoln, state

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By RICHARD PIERSOL / Lincoln Journal Star

Monday, Apr 21, 2008 - 04:39:06 pm CDT

How’s it feel to be part of history?

Since Saturday, people in Lincoln, Omaha and the rest of Nebraska have been paying record high prices for regular-grade, unleaded gasoline. 

And the biggest reason, by most accounts, is the price of crude oil, which set another record high Monday at $117.    That price has tripled since 2004.

Story Photo
(AP File)
Record gas prices

Regular-grade unleaded

(In Lincoln; Statewide)

Monday: $3.548; $3.493

Sunday: $3.536; $3.471

1 month ago: $3.257; $3.244

1 year ago: $2.922; $2.842

“So it’s no surprise, I guess,” said Chuck Salem, president of Salem Oil Co. in Lincoln. 

And yet, local demand seems steady, if anything, at a time when fine weather starts making it rise, according to Salem, whose company operates seven Fast Break BP convenience stores. 

“It’s hard to answer exactly,” Salem said of local demand.  “It’s been pretty steady.   Maybe a little slackening that’s kept us steady.   If there is some, it’s slight.”

So don’t expect to pay much less, unless it’s the dime or so you pay less for ethanol.  In Nebraska, motorists can expect a peak range of from $3.40 to $3.60 this summer for self-service unleaded, according to AAA.

Salem also mentioned the other influences on gasoline prices that people have been talking about.  Or cussing about.

Such as the value of the dollar, which, because it’s falling, has made petroleum products priced in dollars more expensive.   Meanwhile, bullish market speculators see no end in sight to rising petroleum prices, so they invest more and send futures prices even higher. 

Salem said he was talking to a group of business friends, people who know markets, over a weekend golf game.

As the Nebraska and Lincoln gasoline price records fell, the friends started figuring how much of the price of a barrel of crude was what it costs to get oil out of the ground, refined and to market. 

“And how much of it is our president turning our dollar to a half dollar?” Salem exaggerated.  “And how much to speculators?

 “My thoughts are that speculators, treating gas or diesel as a commodity, have paid a huge part in running those prices up,” he said. Then, of course, there is the new demand from countries like China using more of a finite resource in a worldwide market.

“They (the speculators) see that and keep buying like crazy,” Salem said.  

The devaluation of the dollar, assisted by lower interest rates, drives up gasoline prices by making commodities like oil, priced in dollars, more attractive to foreign investors with relatively stronger currencies to invest.

The dollar is weaker for a lot of reasons, not least of which are the huge U.S. trade deficit, declining U.S. economic growth and low interest rates.

OPEC blames U.S. economic policies.  President Bush tries in vain to get OPEC to increase production.

So goes the price of a barrel of oil.  

“I think we came to a meeting of the minds that the speculators were good for $20, and the devalued dollar is responsible for about $30,” said Salem, on behalf of the golfing market minders.

So that’s $50 of premium on top of what they figure could be a more realistic price of a barrel, around $60-$65 or so, supported only by supply and demand.

That means about 41 percent politics and panic in the value of a barrel of oil.

And that’s the hottest explanation going for why the price of regular gasoline was at a record price of $3.548 in Lincoln on Monday.

Lincoln’s previous record high average price for regular-grade unleaded gasoline was $3.48 a gallon, set last year on May 22, when a Kansas refinery was out of service because of flooding.

Nebraska’s  previous record average was $3.43, set May 23, 2007. 

 Reach Richard Piersol at 473-7241 or at dpiersol@journalstar.com.  


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chad wrote on April 21, 2008 5:05 pm:
" Of course it's still a dime cheaper in Omaha than in Lincoln. Why is this always true? "
Checked wrote on April 21, 2008 5:39 pm:
" on AAA. Prices in Colorado, Wyoming are at least a dime cheaper. In Kansas, Iowa around five cents. Missouri is the least right now at 18 cents. In nebraskas case we can blame the difference in state tax. Now they are talking about raising the wholesale tax don't be fooled into thinking it won't be passed on. GW and his borrowing from Saudi and China has devalued the dollar so much it will take generations to ever get the loans paid off. I can only hope another party wins the election to see if they can start getting all this under control. I understand that in Europe they pay high gas prices. Now the rest of the story is that they get health insurance for all the population that this tax helps pay for. I was stationed there as current as 1998 and made do with ration cards. "
Jim wrote on April 21, 2008 5:40 pm:
" Ok the price of oil is three times what it was in 2004. IS GAS NOT THREE TIMES HIGHER.What is wrong with the picture? "
right wrote on April 21, 2008 5:42 pm:
" But remember there is no price gouging. Our president says so. "
I Disagree wrote on April 21, 2008 6:01 pm:
" With checked. I came back from the Ozarks today. I stopped in Ozark Mo and paid 3.25. Deciding to fill before leaving missouri and arriving in nebraska I filled up in St. Joe. I paid 3.29. So lincolns price is 3.54 and ozark mo is 3.25 it comes out to 29 cents cheaper instead of 18 cents. Something is wrong here. "
homey wrote on April 21, 2008 8:48 pm:
" Chad last weekend it was 15-20 cents cheaper in Omaha "
Can't understand? wrote on April 21, 2008 9:23 pm:
" Hey, we did all the right things in the last 7 years. We elected a Texas oilman President and then re-elected him four years later. I just don't understand why the oil companies haven't been able to manage this better. "
Huh? wrote on April 21, 2008 9:40 pm:
" I filled up in Iowa Sat. night and it was $3.29 and here in Lincoln it
was $3.44. The oil companies probably learned Nebraska's gouging practices! "
Tray wrote on April 21, 2008 10:21 pm:
" I filled up in St Joseph Mo last night at 3.25 and this morning in Warrensburg Mo 3.29. I drove to St Louis Mo and paid 3.48 only to drive a few miles past St Louis onto the Illinois border where I live to pay 3.69 to fill up my second car. That is a 44 cent difference in one day and a 40 cent difference within a couple of hours driving. Is the tax 40 cents more in one state? "
MP wrote on April 21, 2008 10:48 pm:
" Becasue the President sets the gas prices right? Right "
not yet stranded wrote on April 21, 2008 10:49 pm:
" I think after it reaches $4.00 I will definitely map out a game plan. I will run my errands when I have to go out to pick the kids up from school, that way I am not running all over the place. I will use a route that is quickest. We will determine what we will do and wont do for extra activities. "
Shafted wrote on April 22, 2008 6:44 am:
" We can all try to conserve all we want but it will not make a difference. Cut back 20- 30% figure it out how many dollars will you save. If the goverement would stop spending and cut out 3% not that would be something. We are shafted by big oil running the law makers. Have you heard the words conserve and cut back used in the 10 years. We all drove 55 in the 70's and 80's they will not even talk about this now. "
Iowa is the reason wrote on April 22, 2008 6:58 am:
" Omaha has cheaper gas prices because they have to compete with Iowa. Iowa doesn't have the high tax rate like Nebraska. I live in Omaha and it's nothing for me to drive across the river and fill up. "
Tired of Whining wrote on April 22, 2008 7:42 am:
" Did everyone forget how the prices went up last year from the flooded refinery and oil companies still reported record profits quarter after quarter? I can't believe you people are allowing yourselves to be spoon fed this garbage. Who do you think the futures investors are in bed with, if not a member of? Oh, and lets all blame the president for problems with pricing of a free market. Lets not take the blame at all for the gas guzzling SUV's or the mindless buying without questioning we've done for years. Did anyone else notice that suddenly car companies are coming out with new SUV's that get the same gas mileage as cars? We did this to ourselves and there's nothing our president could have done to stop it. "
Kevin wrote on April 22, 2008 8:18 am:
" Here's what I can't figure out: I hear people complain over and over about how much they are spending for gas, blah, blah, blah. But when I'm driving on the Interstate, I notice that everyone seems to be driving 75 mph or more. One of the best things you can do to conserve gas is to slow down. I'll say it again: slow down!! So apparently all the people driving on Nebraska highways have plenty of money and don't mind spending it on gas. As for me, I don't have a lot of money to be spending on gas, which is why I drive 50-55 mph on the highway, the range of speed where I've determined my car is most efficient. "
The wrote on April 22, 2008 9:40 am:
" problem I see goes all the way up. No one in government is even speaking about this. Watch the politicians wanting elected president. They don't even mention it. Hillary and Barrack are discussing health care. The oil and devalued dollar is ruining the economy. Not housing. What I want to see is every diesel truck stop for two days on all the roads in the u.s. Make the interstates a parking lot. After paying 4.50 a gallon they should strike. That would bring the elected people to attention. "
Smiles wrote on April 22, 2008 9:48 am:
" Being we are staying in IRAQ for another 50 years, lets just become an occupying nation (oops we are), and do what is right as the occupying nation.... PUMP THE OIL RIGHT TO OUR TANKERS.... "
Grundle wrote on April 22, 2008 9:54 am:
" Yeah...drive 50 mph on the interstate and see what happens when you get rear-ended by a big rig who's been on the road for too many hours. Sure, it may be his fault, but that won't matter much if you die. As far as oil goes, I think the thing to do that makes the most sense is to take it off of the commodity market. If it's all a bunch of idiot investors driving the price up, then let's take it off of the market. That should bring the price back down to a more reasonable $60-70 per barrel, bring gas prices back under control. Our own U.S. citizens are stabbing fellow Americans in the back with speculative investing on oil...lets put a stop to it. "
Shadow wrote on April 22, 2008 10:00 am:
" i only have three words... hydrogen hybrid conversion. i downloaded plans from the internet and have made a $50 modification to my 1985 chevy pickup giving it almost 30 miles to the gallon from the pitiful 18 i had before. heres my math...

800 for the truck
50 for the conversion

850 and now i have better gas milage than my 2005 kia rio. "
MarkyMark wrote on April 22, 2008 10:49 am:
" No the president does not set oil prices. A very simple statement. BUT...his actions certainly do...creating an unconstitutional war in the volatile oil-rich Middle-East is behind most of this crisis. The fat Texas oil Millionaires, Now Billionaires are still high fiving with this massive redistribution of wealth. Mr. Bush belongs in prison with the rest of the terrorists. Maybe he can get time off for wearing his "Made in China" flag pin! "
No funny business... wrote on April 22, 2008 1:54 pm:
"
No, the president doesn’t set the gas price. However, he does set energy policy.

Don’t suppose you recall the Bush administration’s refusal to give information on their closed-door energy policy meetings held with energy executives back in 2002? They wouldn’t tell us the content of the discussion, the names of energy executives who attended, when and where the meetings were held, or even how much the sessions cost taxpayers. VP Cheney defended the need for secrecy by saying that the administration wanted to receive “unvarnished” advice from the executives.

Now it is six years later. Gas prices have more than tripled, and oil companies like Exxon are registering record profits, quarter after quarter after quarter.

Kind of makes you wonder what wonderful advice those executives gave the Bush administration and why they didn’t want the general public to know anything about it. Whatever it was, it seems to have worked out REALLY WELL for the executives and no so much for everyone else.



"
What Carribou wrote on April 22, 2008 2:34 pm:
" I say screw the carribou you animal rights activists! Start drilling for that oil up in Alaska and start supplementing our oil supply. The less we have to buy from abroad the better off we will be. It's us or a few animals up where noone will ever miss them anyways. "
Sure wrote on April 22, 2008 3:50 pm:
" There isn't a hydrogen hybrid conversion that you could get for $50 dollars. The process of making hydrogen is energy intensive and not a safe practice for the home user. For that matter the amount of hydrogen you would have to produce on the fly couldn't be generated from a vehicle. To carry around compressed hydrogen would mean a storage system that would cost more than $50. Don't get peoples hopes up on the quick fixs. "
MarkyMark wrote on April 22, 2008 4:44 pm:
" Oil might be 3 times what it was in 2004, but it's 6 times what it was in 2000 BB (Before Bush). "
PJK wrote on April 23, 2008 5:43 am:
" Took my son to work, at 11 pm at the airport I 80 exchange it was $3.44, at 6:30 am when I picked up him (7 hours later) it was $3.53. So with this rate of 9 cents per hour, it should be $4.00 around noon ! ! ! "
Nebraskan wrote on April 23, 2008 7:36 am:
" Does Bruning think we are being gouged now? Anyone that doesn't expect this with the record profits we're seeing is not in touch with non-alien voters. "
Grundle wrote on April 23, 2008 8:45 am:
" MarkyMark is right...the price of oil has skyrocketed under Bush. Clearly, Bush erred by not bombing the crap out of China and preventing the astounding rise in global oil demand that has resulted from China's greatly increased consumption. See...when you're liberal, you can ALWAYS blame it on Bush. "

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