Gas prices rise; prepare for more than $5 per gallon
ASPEN Aspen’s gas prices are some of the highest in the country, and one local analyst says things are only going to get worse.The two gas stations on Main Street in downtown Aspen list $3.79 for unleaded regular, and the Airport Amoco listed $3.81 on Wednesday, more than the average price in cities like New York, Los Angeles and Honolulu, which have notoriously high pump prices.”When the tulips come up, gasoline prices rise,” said Philip Verleger, an economist with his own Aspen-based consulting firm, PKVerleger LLC.Verleger has been following energy markets for decades and said rising prices aren’t a conspiracy but the result of decreased refinery capacity. And refineries are stressed because of demand for cleaner fuels, he said.
A federal requirement for lower sulfur content in diesel fuel means refineries are taxed, Verleger said. The catalysts necessary to reduce sulfur content don’t last the three years originally planned, which means regularly shutting down parts of refineries and increases delay, Verleger said.Verleger said there’s less refined gasoline available this year than last year. And he estimated prices as high as $4.50 this summer nationwide and as much as $6 in Aspen.”One of the reasons why this happens every spring is because the lords of chemistry conspire against consumers,” Verleger said. In winter, fuel producers add butane to gasoline, but not in warm summer months, which means supply goes down at the same time summer demand rises.”Are the profits of the operators [in Aspen] inflated? Yes. A lot,” Verleger said, but he wasn’t sure of the cause. Verleger admitted it wouldn’t cost much more to truck gas to Aspen, but said high prices are likely the result of high downtown rents and no competition. (The same company owns Aspen’s downtown stations.)Verleger checks gasoline prices daily at the AAA website and said Aspen is regularly 50 cents above the national average.
“This is the price we’re paying for clean air,” Verleger said of the national increase in recent years.Europeans pay up to three times as much for gasoline as those in the U.S., Verleger said, mostly because of higher taxes.And Verleger believes in increasing gas taxes in the U.S., but said increased gas prices do not solve the problem. “Consumers today in London are paying $10 a gallon and traffic is going up. … High gasoline prices don’t seem to do it,” Verleger said.But Verleger said some people have come up with unique solutions. In Singapore, city officials limit the number of vehicles allowed on the road and auction off a limited number of 10-year permits. And cities like Los Angeles offer special permits allowing hybrid vehicles into HOV lanes.
The real solution comes when citizens look in the mirror and say “I’ve got to use less,” Verleger said. Aspen’s Canary Initiative and other programs to reduce greenhouse gases are a good start, Verleger said, and mountain towns are taking the lead because they’ll be the first to feel the effects.But Verleger is skeptical about transit solutions to Aspen’s traffic congestion at the Entrance to Aspen, saying transit solutions work best in high-population areas where public transportation can be ultraefficient.”You can’t get people into buses,” Verleger said, even if local buses were free. He believes in four lanes of unrestricted traffic into Aspen to stop the pollution of idling cars because “people value their time” and will continue to drive.In the wake of recent increase in gas prices, there is a grassroots Internet campaign to avoid pumping any gas May 15. Charles Agar’s e-mail address is email@example.com.
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