Damage to refineries pushes up gas prices

At least one Youngstown station raised the price to $3.09 per gallon Wednesday afternoon.
By DENISE DICK
VINDICATOR STAFF WRITER
Gas prices topped $3 per gallon at some Mahoning Valley stations Wednesday, and a quick end to the climbing costs doesn't appear likely.
Hurricane Katrina battered the Gulf Coast states earlier this week, damaging or destroying oil platforms, pipelines and refineries and leaving others without power.
"That's the area that supplies one-quarter to one-third of the nation's oil and natural gas," said Brian Newbacher, director of public affairs for AAA Ohio Motorists Association.
The association has had reports from members that some Northeast Ohio stations are charging as much as $3.19 per gallon for regular unleaded. One station at Mahoning Avenue and Meridian Road increased its price to $3.09 per gallon Wednesday afternoon.
AAA doesn't expect the high prices to abate until later this month or October.
The secretary of the U.S. Department of Energy said that the Bush administration would release oil from the nation's strategic petroleum reserves to help supply refineries affected by the hurricane. But Newbacher doesn't expect that to mean quick relief.
"It will calm the markets to a point," he said. "The problem is going to be getting it to refineries that are operating. Obviously, they can't refine crude when their refineries are damaged."
Other refineries would have to pick up the slack, but that would be difficult, as many refineries were already operating at 96 percent capacity.
"It's not a pretty picture," Newbacher said.
What's predicted
Dr. A.F. Alhajii, an associate professor and energy economist at Ohio Northern University, believes relief will come in about six weeks.
The devastation in Katrina's wake means fewer people will be on the roads, thereby reducing the demand for gasoline. Oil companies also can import oil from other countries.
"Other countries would be happy to sell us gasoline," Alhajii said.
Provided no more hurricanes hit, the professor doesn't expect the nation to suffer a gasoline shortage.
There are reports of companies' rationing gasoline to stations, though.
Besides perhaps curtailing some Labor Day weekend travel plans, the gas price spike also has some school districts preparing to dig deeper into their pockets.
Austintown saw its diesel costs for transportation double between the 2001-02 school year and last year, and projections had that amount increasing between 40 percent and 50 percent for this school year.
That prediction was before Katrina hit, said school Superintendent Douglas Heuer.
The district already has retooled its transportation plan, eliminating four nonpublic and four public school bus routes for this year. The plan involves transporting nonpublic elementary school pupils to St. Joseph's school before transferring them to other buses to go to their respective schools.
The change reduced the transportation mileage for nonpublic school students from 750 miles per day to 280 miles per day, which should help contain costs, Heuer said.
The high prices are expected to take their toll on the budgets of extracurricular activities.
Extracurriculars, such as sports teams, already are committed to their schedules, which often means long trips to play teams in other parts of the state.
The district's athletic department, which raises the revenue for the teams including transportation, will likely experience a drain on its resources, Heuer said.