THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Saturday, May 27, 1995 TAG: 9505270435
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY MYLENE MANGALINDAN, STAFF WRITER
LENGTH: Medium: 67 lines
If you're heading out of Hampton Roads for Memorial Day weekend, you had better be flying.
Gasoline prices will be high enough, and traffic thick enough, to put some sting in the three-day weekend.
Gas prices have made their highest one-month jump since the Persian Gulf crisis in August 1990, according to the American Auto-mobile Association.
Drivers traveling during this Memorial Day weekend can expect to pay 6.8 cents more on average, or almost $1.20 per gallon, for regular unleaded gas at self-serve pumps, said AAA spokesman Mike Morrissey.
Local gas stations are charging $1.16 per gallon on average for regular unleaded.
Deedee Hicks, manager of the South Norfolk Amoco station in Chesapeake, said her station's mid-grade gas costs $1.29 per gallon. Premium costs $1.349.
``That's the highest I've ever seen them, and I've been working here for eight years,'' she said.
Gas prices normally spike around weekends, holidays and during vacation periods, he said.
``The primary reason is increased demand,'' Morrissey said. ``Certainly, that's driven by a strong travel season.''
AAA predicts a record Memorial Day weekend during which 28.9 million people will be traveling,including 23.6 million that will be using their automobiles. That's a 2 percent increase from last year.
Trips are defined by AAA as 100 miles or longer.
``What's also happening is the bottom line: The price of crude oil is up on the global market,'' Morrissey said. ``There's a lot of uncertainty on the world market about the level of their supply. It goes back to basics of supply and demand. You've got demand going up at a time there's concern about supply.''
A strike by Brazilian oil workers at the country's state oil company, Petroleo Brasileiro SA, or Petrobras, pushed crude futures prices up, and other countries like Indonesia's state oil company, Pertamina, have raised their sales prices, too.
Uncertainty still exists about whether the U.S.-imposed embargo on Iran will affect oil prices later. And reformulated gasoline, which has been implemented to reduce air pollution, has made gas in designated states such as Virginia more expensive.
But no one is predicting a shortage. Crude-oil prices started declining this week, said Bill Taylor, a spokesman for the American Petroleum Institute, a Washington-based trade association. A barrel of crude sold for $18.69 on Friday. This time last year it traded for about $17.70 a barrel.
Prices at the pump have crept up steadily from 99 cents per gallon for regular unleaded gas about six weeks ago to its current $1.16 per gallon price, said John Burch, owner of the Cape Henry Exxon station on Virginia Beach's Shore Drive.
``It's been going up a lot this year,'' he said. ``It's not unique to Exxon. Everyone's gone up. The (profit) margins that guys like me work on is measured by pennies.
``The consumer in Tidewater has one of the better deals in the country. They don't realize that.'' ILLUSTRATION: Color graphic
KEYWORDS: GASOLINE PRICE by CNB