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Gas, oil prices remain erratic

The price of gasoline and fuel oil is so erratic these days that even the people who sell it don’t know when it’s a good time to buy.
When he got into the fuel oil and gasoline business 21 years ago, Buddy Collins of Downtown Exxon said he could “pick up a newspaper and look at the futures and be able to predict (where the price would be) in six months.”
Now, he can’t tell you what it will be this afternoon.
In fact, it is so unpredictable Collins ended up filling his home tank in July with oil that was 68 cents higher than he could get it today. Back then the price was $4.42 per gallon. Now, it’s $3.74.
He says the inconsistency is due to the price being so closely tied to the stock market, which has been erratic in its own right.
Gasoline prices also have been up and down lately, practically changing by the minute. Sometimes, these fluctuations result in one station being higher priced than the one next door.
Collins says consumers need to realize a business’ price is based on the price it paid for the gasoline that is in its underground tanks at that time.
“When (the price) drops this fast, there could be 15,000 gallons of higher priced gas in the ground,” he said. Gas retailers can’t afford to sell the higher priced gas cheaper because they don’t make much off of it in the first place.
“If you fill up your gas tank and then come inside and get a bottle of pop, I can make more off that bottle of pop than I make off the tank of gas,” he said.
But price isn’t the only thing that is unpredictable. These days, just being able to get fuel oil, gasoline and dyed heating kerosene is a challenge.
“I’ve never seen it like this” (in terms of being able to get fuel supplies), he said.
Kerosene is in such short supply, he said he has started limiting his to his long-term customers.
At Conny Oil, Pulaski Office Manager Cheri Sypniewski said she got in a supply of kerosene in the spring so she wouldn’t have to “fight the fall battle.”
She explained that refineries only produce the kerosene at certain times of the year because of its seasonal use. Due to the demand for gas, she said kerosene production has been put on the back burner.
Right now, she added, “there is none at the (supply) terminals.”
Collins said refineries were supposed to make more kerosene in October, but he has been told there won’t be anymore made until November.
When it comes to fuel oil and gasoline, retailers have been on “allocations” (only able to get a portion of what they normally purchase).
Collins said Thursday the allocations started in early September when consumers made a run on gas as hurricane Ike threatened to shut down oil refineries in Texas.
“Everybody panicked” and caused a shortage in supply, Collins said. He said he sold 11,000 gallons of gas that day alone.
He normally gets his delivery out of Montvale, but he had to turn to Greensboro to get his last load. He said he doesn’t understand why he could get it out of North Carolina, but not Montvale.
“If I hadn’t gotten it last Saturday, I wouldn’t have been able to get any until (this past) Wednesday. I would’ve been out for two days. But I was able to find some and didn’t run out,” he added.
Sypniewski said gas allocations were lifted Friday. Until then, she said she was only able to get 70 percent of the amount of product she ordered the previous month.
A 70 percent allocation on fuel oil continued Friday, according to Sypniewski. But she said she is optimistic both fuel oil and gasoline “will be flowing pretty good in a week or two.”
Collins didn’t want to venture a guess on when the situation might improve.
Hugh Huff of Huff Petroleum could not be reached for comment.

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Gas, oil prices remain erratic

The price of gasoline and fuel oil is so erratic these days that even the people who sell it don’t know when it’s a good time to buy.
When he got into the fuel oil and gasoline business 21 years ago, Buddy Collins of Downtown Exxon said he could “pick up a newspaper and look at the futures and be able to predict (where the price would be) in six months.”
Now, he can’t tell you what it will be this afternoon.
In fact, it is so unpredictable Collins ended up filling his home tank in July with oil that was 68 cents higher than he could get it today. Back then the price was $4.42 per gallon. Now, it’s $3.74.
He says the inconsistency is due to the price being so closely tied to the stock market, which has been erratic in its own right.
Gasoline prices also have been up and down lately, practically changing by the minute. Sometimes, these fluctuations result in one station being higher priced than the one next door.
Collins says consumers need to realize a business’ price is based on the price it paid for the gasoline that is in its underground tanks at that time.
“When (the price) drops this fast, there could be 15,000 gallons of higher priced gas in the ground,” he said. Gas retailers can’t afford to sell the higher priced gas cheaper because they don’t make much off of it in the first place.
“If you fill up your gas tank and then come inside and get a bottle of pop, I can make more off that bottle of pop than I make off the tank of gas,” he said.
But price isn’t the only thing that is unpredictable. These days, just being able to get fuel oil, gasoline and dyed heating kerosene is a challenge.
“I’ve never seen it like this” (in terms of being able to get fuel supplies), he said.
Kerosene is in such short supply, he said he has started limiting his to his long-term customers.
At Conny Oil, Pulaski Office Manager Cheri Sypniewski said she got in a supply of kerosene in the spring so she wouldn’t have to “fight the fall battle.”
She explained that refineries only produce the kerosene at certain times of the year because of its seasonal use. Due to the demand for gas, she said kerosene production has been put on the back burner.
Right now, she added, “there is none at the (supply) terminals.”
Collins said refineries were supposed to make more kerosene in October, but he has been told there won’t be anymore made until November.
When it comes to fuel oil and gasoline, retailers have been on “allocations” (only able to get a portion of what they normally purchase).
Collins said Thursday the allocations started in early September when consumers made a run on gas as hurricane Ike threatened to shut down oil refineries in Texas.
“Everybody panicked” and caused a shortage in supply, Collins said. He said he sold 11,000 gallons of gas that day alone.
He normally gets his delivery out of Montvale, but he had to turn to Greensboro to get his last load. He said he doesn’t understand why he could get it out of North Carolina, but not Montvale.
“If I hadn’t gotten it last Saturday, I wouldn’t have been able to get any until (this past) Wednesday. I would’ve been out for two days. But I was able to find some and didn’t run out,” he added.
Sypniewski said gas allocations were lifted Friday. Until then, she said she was only able to get 70 percent of the amount of product she ordered the previous month.
A 70 percent allocation on fuel oil continued Friday, according to Sypniewski. But she said she is optimistic both fuel oil and gasoline “will be flowing pretty good in a week or two.”
Collins didn’t want to venture a guess on when the situation might improve.
Hugh Huff of Huff Petroleum could not be reached for comment.

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