Text 
No Comments [ Add Comment ]Utah retailers keep gas prices high
By JEFF DEMOSSLobbyist maintains sellers are making up for past losses
OGDEN -- A nationwide drop in gasoline prices in recent weeks has failed to manifest itself so far in Utah, one of several states where prices remain stubbornly above $4 a gallon.
The average price for a gallon of regular, unleaded gasoline in the Ogden-Salt Lake City area was nearly $4.13 Wednesday, according to a daily survey from AAA.
Utah's statewide average Wednesday was almost $4.16 per gallon, compared to a national average of $3.86.
Among the 11 states where average prices are still above $4 a gallon, only Alaska, California and Hawaii currently have higher prices than Utah.
After hitting record highs nearly every day from mid-April through mid-July, local prices have retreated slightly from a high of $4.17 on July 18.
But while prices nationwide have since fallen an average of 25 cents per gallon, local prices are only 5 cents off in the same period.
John Hill, executive director of the Utah Petroleum Marketers & Retailers Association, said local retailers are currently enjoying some better profit margins after taking a beating in recent months.
"We are trending down, but as we do typically, we lag behind the national average as prices go up, and we lag behind the national average when prices are coming down," Hill said.
He said the presence of several oil refineries along the Wasatch Front does little to mitigate high prices, largely because much of the fuel produced in-state is shipped to neighboring states.
The unprecedented rise in gasoline and diesel prices this year placed some retailers in the uncomfortable position of selling fuel at below cost. Hill said that while the current easing of prices has relieved some of the pressure, retailers are still struggling with credit card fees and overall economic sluggishness.
"The retailer does not like high prices either," he said. "More people are using credit cards, fewer people are going into the stores to buy groceries or snacks, and more people are trying to steal gas."
He said a typical retailer currently makes about 18 cents of gross profit from the sale of a gallon of gasoline, and more than half of that is consumed by credit card fees.
"Last year, credit card companies made more money off of gasoline than retailers did," he said. Retailers also have payroll and other operating expenses that eat further into profits, he added.
The recent drop in gasoline prices is tied to crude oil prices, which have eased off a July 3 high of more than $145 per barrel and are back around $120, at least temporarily.
Oklahoma's $3.61 average was the lowest in the nation Wednesday. Four other states -- Minnesota, Missouri, Ohio and South Carolina -- had averages below $3.70 per gallon.
Add Your Comment
