As Michigan’s average gas price reaches a near-record high, readers have expressed a lot of frustration on MLive, not to mention during trips to the gas station.
They’re criticizing oil companies and questioning what government leaders are doing to ease the pain.
Lansing resident Paul Heintz said he and his wife try to plan errands more efficiently by paying the bills and grocery shopping in one trip instead of two, for example. High gas prices make a big dent on their wallets, since Heintz drives a Chevrolet Suburban and his wife has a Cadillac Escalade.
“It’s ridiculous, really,” Heintz said as he pumped $4.29 per-gallon gas into the Escalade on Friday.
And take pity on tanker driver Trenton Huber, who hears from angry customers as he delivers fuel to gas stations for Marathon Flint Oil.
“They say crazy stuff, I mean, you hear a lot of people yelling …” he said while making a delivery to the Marathon station at Pine and Saginaw streets in Lansing Friday morning. “It’s out of my control, I just deliver.”
Michigan’s average price reached $4.25 on Friday, just shy of its record high of $4.26 in May 2011, according to AAA Michigan’s survey of 2,800 Michigan gas stations updated at 3 a.m. Friday.
MichiganGasPrices.com reported the statewide average at $4.24 on Friday afternoon. The website, which tracks prices in real time based on user-submitted data, noted that prices are falling.
Refineries serving Michigan and neighboring states are low on supplies due to facility problems or maintenance, causing Michigan’s average gas price to surge to the second highest in the country behind only Hawaii.
The BP Whiting Refinery in Indiana is completing construction and start-up of a new processing unit, while ExxonMobil’s Joliet Refinery in Illinois is undergoing planned and scheduled maintenance.
In response to questions from readers, MLive asked representatives at ExxonMobil and BP: Why don’t you use some of your billions of dollars in profits to cover gas price increases associated with your own maintenance and refinery issues instead of passing the hike onto consumers?
“Gas prices (are) determined by supply and demand factors. These include everything from the cost of crude oil, competition between independent gas station owners and consumer demand patterns,” BP spokesman Scott Dean wrote in an email. “The single biggest factor is the cost of crude oil which currently accounts for about two-thirds of the cost of a gallon of gas.”
ExxonMobil spokeswoman Tricia Simpson wrote in an email that refinery maintenance “is an infrequent but necessary activity to ensure continued safe and reliable operations.” She said the refinery has a plan to meet contractual commitments for gasoline and diesel. She did not immediately respond to further questions, including why the company wouldn’t absorb price increases tied to refinery issues.
While crude oil prices play a significant role on the retail market, the Michigan spike is more tied to regional supply and demand due to refinery issues, said John Griffin, executive director of Associated Petroleum Industries of Michigan.
Oil companies have to pay higher prices to purchase fuel from other suppliers when their refineries are down. If they absorbed the cost increase to keep pump prices low, the less expensive gas would quickly run out, leaving only stations charging the higher market price, Griffin said.
Democratic lawmakers released a statement on Friday denouncing high gas prices. They promoted legislation introduced in February that would provide consumers with tax breaks on annual gas expenses for traveling to work, and another bill to eliminate a tax remittance allowance for suppliers. They’re also working on a proposal to let employers allow workers to contribute pre-tax earnings to a flexible spending account for gas expenses.
Ananich spokesman Tom Lenard said the tax break could be offset by increased consumer spending as well as closing “tax loopholes” on oil companies.
Ari Adler, spokesman for House Speaker Jase Bolger, R-Marshall, said the Democrats were “grandstanding rather than actually addressing a problem with a real solution.”
“Until the Democrats are willing to pressure the Obama administration into allowing additional resources for fuel shipment and storage, they really don’t have a leg to stand on when it comes to complaining about gas prices,” Adler said in an email.
An MLive reader poll with about 500 votes showed 86 percent are cutting back on non-essential driving, while 14 percent are continuing to drive and fill up as normal.
Email Melissa Anders at manders@mlive.com. Follow her on Google+ and Twitter:@MelissaDAnders.
