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No investigations are planned, even though Utah has the fourth highest gas prices in the country while prices are plummeting elsewhere.
So why are we here? We try to explain the "oil business" in part two of our series, "Fueling the frustration."
Where do you start to pin the blame? At the pump? Maverik spokesman Brad Call said, "It's been one of the leanest years we've had in a long time."
Lee Peacock, president of the Utah Petroleum Association, said, "It is frustrating to always seem like the bad guy."
Oil people here say drivers aren't the only ones hurting. Call said, "We hate high gas prices as much or more than Utahns." Call says that's because gas stations get squeezed by the credit card companies. "They're making more money on my business than I am," he said.
Gas stations wind up with about 2 percent of what you pay when you use plastic.
So what about refiners? Peacock says Tesoro, which has a plant in Salt Lake, made a half-cent per dollar of sales in the second quarter. "That's not where people are making money," he said.
Tesoro is one of five refineries along the Wasatch Front. It seems like common sense that gas produced here would mean cheaper prices for Utahns. Peacock says no. "It doesn't insulate us from the market price of fuel to have our refineries here," he said.
That's because others are bidding for our gas, says John Hill at the Utah Petroleum Marketers and Retailers Association.
"There is refined product leaving the state, too, and even being sold in Washington State -- by pipeline -- Oregon and Idaho," he said. In fact, Utah pays for transportation to get a lot of gas from Canada and Wyoming.
Then there's the issue of the lag. Utah's prices are high long after other states' have gone down.
Governor's Office Economist Juliette Tennert is trying to figure out the "why." The "what" is obvious on paper. "Prices adjust in different regions at different rates," she said. That appears to be as solid an answer as there is out there.
In the meantime, John Hill says, "Profit margins are a little stronger than they normally are."
Hill says the locals are playing catch-up, but not for long. Retailers and the AAA say gas prices are going down. They're likely to approach a projected national average of $3.75, if crude oil prices don't go back up.
E-mail: aadams@ksl.com
