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Gas prices set another record; spikes hurting businesses, workers

By Johnny Jackson

jjackson@henryherald.com

Big-rig truck drivers are not the only ones complaining about the rising cost of fuel.

Pizza delivery drivers, taxi drivers and every-day commuters in metro Atlanta were greeted Monday with yet another record high in average gas prices that topped $3.36 per gallon for regular unleaded.

On average, metro Atlanta's gas prices have increased by more than 65 cents per gallon compared to this time a year ago (from $2.71 to $3.36 per gallon) - a rate much higher than some businesses can maintain for compensatory gas mileage.

Pizza deliveries drivers, for instance, are paid a standard gas mileage rate that does not necessarily increase with gas prices, according to Joseph Badosky, manager of Papa Johns Pizza in McDonough.

The drivers, who support about 70 percent of the pizza parlor business, must pay record gas prices with last year's standard gas mileage rates.

"Seems like, now, what they're paying out in gas exceeds what they get," Badosky said. "Most of it is coming straight out of their take-home pay, and they're taking less home to their family."

In the past, he said, the difference in money earned and spent on the job was offset through an increased delivery charge, or a 10-cent increase on pizza prices.

"We have to make up the difference somehow," Badosky said. "We've done our part for the most part, but we just can't keep up with the rising gas prices."

The recent price increases, however, have out-paced efforts to keep the out-of-pocket costs down. And officials believe gas prices will continue to rise at least through June, reaching $3.50 to $3.75 per gallon for regular unleaded.

"The prices that we're seeing are still not being dictated by supply and demand," said Gregg Laskoski, spokesman for AAA Auto Club South.

Gas prices, he said, are being driven by the value of the weakened U.S. dollar and the continued crude oil rally. Crude oil prices have consistently been well above $100 so far this spring.

The International Energy Agency reduced its global oil consumption forecast for the third straight month, and decreasing demand caused crude oil on the New York Mercantile Exchange to fall to an opening price of $109.65 per barrel on April 11 - crude oil closed that day at $110.14 per barrel.

"[But] it's distressing to say 'crude oil fell to $109.65' because it means the price is still bloated," Laskoski said. "We're near record-setting territory, since the peak price for crude is $112.21 per barrel in intra-day trading. The rally for crude oil has gained new momentum for many reasons, and the weak dollar remains a catalyst for that momentum."

Switching from winter to summer blends of fuel - which requires refineries to temporarily shut down for maintenance - also causes a strain on supply and consumption that feed into the momentum.

"We certainly need long-term policies that would make it easier for refineries to operate and get the product to consumers," he said. "Under these circumstances, it is difficult to expect anything other than the current pattern, continuing incremental price increases at the retail level."