Gas price story remains murky
Wholesale figures are vague and attract legislative criticism
The pre-tax wholesale cost of gasoline on Oahu averaged about $2.32 a gallon in the first week of July when prices at the pump were almost $1 higher.
However, the wholesale cost figures, released yesterday by the Public Utilities Commission under new weekly reporting requirements, are not necessarily indicative of what gas stations paid for their fuel before reselling it to customers.
The $2.32 average includes not only prices paid by gas stations who get fuel direct from refiners, but also higher prices at each step of the supply chain when a jobber or several jobbers are involved. For example, if a refiner sold gas to a jobber who then sold it to a gas station, both wholesale transaction costs figure into the overall average cost.
Also, the $2.32 average includes transactions for conventional regular unleaded, regular gasoline blended with 10 percent ethanol and the lower-octane stock that is used to make the 10 percent blend, all of which typically sell at different prices.
According to AAA, the average retail price for regular unleaded on Oahu that week was $3.20 a gallon. That also was the week that a general excise tax exemption, amounting to about 10 cents per gallon, was restored on most gasoline sold in Hawaii.
The vagueness of the weekly reports -- the first of which was issued last week -- has led to criticism by some that the data are of no use to the average consumer.
"I'm discouraged by the fact that there's been no change, no improvement, in the method of reporting," said House Majority Leader Kirk Caldwell, who fought for the "transparency" reports in lieu of the short-lived wholesale gasoline price caps.
"If it doesn't get better, I think the Legislature may need to take a look at ways of working with the PUC so that the information is useful," added Caldwell (D, Manoa). "We need to get this information out in a manner that is understandable."
The four-page Petroleum Industry Monitoring and Reporting Program reports are compiled from information submitted each week by participants in the state's oil industry.
"Going forward, as the commission clarifies certain matters, confirms the data as necessary and gains greater experience with the reporting entities' submissions," the PUC said in the report, "the commission will look to refine and expand its PIMAR weekly reports to add trending analyses to gain insight on market behavior over time and changing circumstances and make other useful and significant information available to the public."
Neither the first nor the second report made any conclusions or findings of fact.
Reports also do not provide any statewide figures. The PUC reported data for each of eight zones across the state: Oahu, Kauai, Maui excluding Hana, Hana, Molokai, Lanai, Hilo and Kona.
In yesterday's report, for the week ending July 8, the PUC said retail prices for all grades of regular gasoline on Oahu was $2.83 a gallon, not including taxes. However, that price reflects sales to commercial users of gasoline. The PUC does not collect retail sales price information from lessee dealer-operated stations, owner-operated stations or other retailers who sell to the public.
As in the first report, some prices and figures for inventory could not be published.
Because there are only two oil refiners in the state, some information had to be kept confidential for competitive reasons, the PUC said. For example, releasing the total amount of crude oil inventory for both refiners would allow each competitor to calculate the other's stock.
The withholding of those numbers does not mean they are being overlooked, said one oil industry representative. The law requires the PUC to analyze the information submitted and report irregularities that could signify illegal activity.
"The Legislature felt it was important to have some oversight and monitoring," said Melissa Pavlicek, a lobbyist for the Western States Petroleum Association, an industry trade group. "I think the PUC is doing just that.
"If there's some information that they can't disclose ... that doesn't mean that the PUC is not reviewing that information."
