Gas prices heading up a bit
Global oil disruptions augur a slight rise in numbers at the pump
A three-week downward trend that put the state's wholesale gasoline price caps at their lowest points of 2006 is expected to come to an end next week, but any increase is likely to be minimal.
Price caps for next week are forecast to go up by a penny, according to preliminary Star-Bulletin calculations.
The decline comes to an end as crude oil prices have increased during the past few days as a result of political unrest in significant oil-producing regions.
Oil prices rose $1.59 a barrel, to $61.48, in London yesterday in response to violent militant action against oil pipelines in the Niger Delta that led to a 20 percent cut to Nigeria's oil production. The latest violence did not cause further production cuts, but sent oil prices higher.
Although U.S. oil markets were closed because of Presidents Day, oil prices had jumped more than $1 and settled near $60 a barrel Friday over supply concerns.
Concerns over Nigeria's oil supply and the frequent attacks on oil installations have the potential to lift prices per barrel back to the $65-to-$70 region, said Sucden Commodity brokers.
"Despite the current glut of crude oil from the oversupply, the lack of spare production capacity has the market on edge," the firm said.
Insurgent violence in Iraq also has increased during the past few days, with sabotage to northern Iraqi oil installations halting exports of 400,000 barrels a day.
Hawaii's price caps are tied to an average of wholesale prices in three mainland markets. Those prices track closely to crude oil prices.
Next week, if wholesalers charge up to the maximum allowed and dealers add a markup of 16 cents, gas prices are forecast to range from $2.54 a gallon on Oahu to $2.90 a gallon on Lanai.
Meanwhile, yesterday's statewide average was $2.81 a gallon, 57 cents above the national average, according to AAA's Fuel Gauge Report, which bases its survey on credit card transactions from the previous day.
Actual prices on Oahu ranged from $2.68 to $2.87 a gallon from Kahala to Kaimuki along Waialae Avenue. Closer to downtown, Lex Brodie's in Kakaako had the lowest price at $2.59 a gallon for regular.
The statewide average is expected to come down as dealers sell off existing supplies and refill their tanks with gasoline bought under price caps that have come down by 29 cents in the past three weeks.
By next week the statewide average could go to about $2.70 a gallon.
Meanwhile, lawmakers are expected to continue the debate over the gas cap.
The Senate Consumer Protection Committee, in the next few weeks, is expected to take up a proposal to amend the price cap law. Committee Chairman Ron Menor (D, Mililani) said the amendments could result in savings to consumers of about 16 cents per gallon.
Menor said he will not hear any proposals coming over from the House that would repeal or suspend the gas cap.
The House is advancing a measure to suspend the cap in place of strict oversight of the oil industry's pricing practices in Hawaii. The proposal has the support of the full House, where it passed by unanimous voice vote Friday and now goes to the Finance Committee.
Menor's counterpart, House Consumer Protection Chairman Bob Herkes (D, Volcano-Kainaliu), has said the chamber would likely force the issue to conference committee, where lawmakers negotiate the final versions of all bills.
The Associated Press contributed to this report.