Gasoline prices leap 30 cents in Maine

One day after gas prices in Maine shot up more than 30 cents to unprecedented heights, pump prices continued to rise Thursday, pushing the statewide average cost to more than $3 per gallon.

In some parts of the state, consumers could not find a gallon of low-octane gas Thursday for cheaper than $3. The lowest posted price for a gallon of gas along the Route 3 corridor that connects Ells-worth and Bar Harbor was $3.079. In northern Maine, prices jumped as much as 20 cents overnight, pushing some of the cheapest prices up to $3.19.

In Bangor and neighboring communities, only a few service stations were reported Thursday to have gas prices a few cents below the $3 mark.

“The average in Maine is right around $3.03 right now,” Matthew McKenzie, spokesman for AAA Northern New England, said Thursday afternoon. The state’s average price at the end of the previous day, when prices shot up 30 cents, had been around $2.90, he said.

In an effort to stem the rise of fuel prices, Gov. John Baldacci met Thursday morning with oil industry leaders and other state officials to make sure Maine’s oil and gasoline supplies were healthy and that steps are being taken to prevent stocks from getting low.

“He learned from the oil dealers that Maine has an adequate supply of home heating fuel and gasoline,” Lynn Kippax, Baldacci’s press secretary, said Thursday.

A corresponding press release from the governor’s office indicated Baldacci also discussed the price hikes with Maine Attorney General Steven Rowe, whom Maine Senate President Beth Edmonds on Wednesday had urged to investigate the sudden increases.

“We are working together to make sure that there is no profiteering, unfair trade practices, or collusion in gas and oil markets,” Baldacci said in the statement.

The leading cause cited by experts and industry leaders has been the lingering effects of hurricane Katrina, which on Monday slammed into the coast of the Gulf of Mexico with 145-mph winds. Oil pipeline links and eight refineries in the region remained closed Thursday, with many oil companies unsure of the extent of damage sustained at the flooded facilities.

Only one of the eight refineries now shut down has spelled out plans to restart. Valero Energy Corp. estimated it will take two weeks to resume operations at its St. Charles, La., facility, which has a normal production capacity of 260,000 barrels a day.

As refining capacity and the resulting supply remain low but demand remains high, prices aren’t likely to decrease in the coming weeks, according to AAA’s McKenzie. He reiterated his prediction that gasoline prices likely would be close to $3.80 per gallon in Maine before September is over.

“The real wild card is if another storm blows through there,” McKenzie said, noting there are a couple more months left to the annual hurricane season.

Gasoline futures surged Thursday on the New York Mercantile Exchange for the fourth day in a row, sending prices 25 percent higher in less than a week. Unleaded gasoline for October delivery traded at $2.42 per gallon, an increase of more than 16 cents.

Crude reached a record intraday high of $70.85 a barrel Aug. 30. Prices are more than 50 percent higher than a year ago but would need to reach $90 to surpass the inflation-adjusted high set in 1980.

“Depending on what we learn in the next few days this may be the biggest oil-supply shock since the 1970s. We are now in the days of reckoning,” said Daniel Yergin, an expert with Cambridge Energy Research in Cambridge, Mass.

In another press release, Maine’s attorney general said that hoarding practices such as filling unneeded gas cans or continually topping off tanks can exacerbate supply problems. Rowe stressed that it is legal for retail gasoline and oil dealers to pass their high wholesale costs along to consumers.

Mainers should take steps to conserve fuel, such as planning their vehicular trips ahead of time, car pooling, keeping tires adequately inflated, and cutting back on unnecessary errands, the statements indicated.

Some retailers in eastern Maine have said their wholesale prices jumped more than 50 cents over the course of Tuesday and Wednesday.

Dan Vaillancourt, president of Daigle Oil Co. in Fort Kent, said Thursday that retailers are not responsible for the skyrocketing prices.

“This week has just been a blur,” Vaillancourt said. “There was volatility in the market for months, mostly from speculators in New York, but all that changed Monday.”

As for home heating fuel, Vaillancourt said the approaching heating season could be problematic if refineries that have been producing heating oil switch to making gasoline. At the present time, heating fuel prices are not as volatile as gasoline prices, he said.

“Gasoline and diesel prices are critical,” Vaillancourt said.

The Associated Press and BDN reporter Beurmond Banville contributed to this report.