Record Gas Prices Have More Than Just Consumers Fuming
Posted May 28, 2004 7:15 a.m. EDT
RALEIGH, N.C. — Believe it or not, motor-vehicle drivers are not the only people fuming over record gas prices.
Station owners have said high prices at the pump are cutting into their profits.
Because they only make a few cents on gas, most station owners rely heavily on store sales and car services to turn a profit. When gas prices rise, consumers spend less money on those other items.
With gas prices averaging about a $1.94 per gallon in North Carolina, $1.88 in South Carolina, consumers want to know if there is any relief in sight. Some are calling for a gas boycott on future major holidays.
Cars were lined up bumper-bumper at Dunn's Service Center in Raleigh on Friday. The sign said gas was only $1.82 a gallon.
It was a sign of relief for fed-up drivers.
"It's worth the trip to come down here and save some money," customer Lorraine Phillips said.
Although the customers might have been saving money at the pump, the station was not making any.
"We lose about four cents off the gallon," said Dunn's assistant manager, Louis Danzy.
The owners hoped to make up the loss with inspections and repair work, while their friends tried to drum up support for the effort.
"It's very important that businesses like this stay alive," Rev. Darrell Parker said. "That's going to help our community."
Rep. Bob Etheridge, D-Lillington, was beating a different drum. He wants the president to tell Saudi Arabia to increase oil production.
"What's going to be done about these high gas prices?" Etheridge said. "Mr. President, call the Saudi prince and tell him to open the spigot."
University of North Carolina at Chapel Hill finance professor James Smith said the call has been made, but that we have to wait for the additional supply to reach our pumps.
"Everybody's screaming for the president to talk to the Saudis," Smith said. "Guess what? He did. Guess what? They decided to pump a whole lot more oil, like, two million barrels a day.
"So, in a couple of months, we'll get a lot of relief."
Dunn's Service Center hopes it can hold out that long without raising prices too high.
"We're trying to work with the public to keep prices down," Danzy said. "It will benefit us in the long run."
Smith said he expects a 25-cent price drop sometime between the Fourth of July and Labor Day. He said it is not expensive for Saudi Arabia to increase supply and that it was in their best interest to do so.
"The longer this goes on, the more we start to economize," he said. "And then Saudi Arabia is sitting on a valuable asset that doesn't sell as well."