EagleTribune.com, North Andover, MA
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Merrimack Valley
Drivers already cutting back on gas
Published: November 10, 2007
Gary Paradis owns a plumbing and heating company in New Hampshire and he's taking on four extra jobs a week to pay for gas for his box truck. He's been filling it every other day, spending $75 each time.
Barbara Talbot of North Andover and her family have cut trips to their vacation home in Freedom, N.H.
And Maurice Lynch, 68, of North Andover is keeping his travel local.
Gas prices, hovering close to $3 a gallon here, are fueling the angst of some local drivers. This time last year, on average, drivers were paying about $2.19 a gallon.
"I can't stand paying for gas," Talbot said as she filled up her Toyota Highlander. She and her husband traded their larger Toyota Sequoia to save money when gas prices first reached, then topped, the $3 a gallon mark in 2005.
The forces driving prices up this time aren't much different. Uncertainty over the future of oil from the Middle East, increased demand for oil from China and India, more people driving SUVs and the additional demand for gas for holiday driving and shopping all are driving the cost of oil up, said economists interviewed for this story.
"It goes in ebbs and flows," said Robert J. Cuomo, dean of the Girard School of Business and International Commerce at Merrimack College in North Andover. "It depends on what the mood is, in terms of uncertainty. Markets get spooked. People become paranoid and start to hoard. The demand goes up, and the price of gas goes up."
This time, the declining value of the dollar against the Euro has made importing gas more costly, and the price of crude oil is edging toward $100 a barrel. In 2005, the price for a barrel of oil was $70. As a result, some experts worry gas prices might be in for more of a jump.
"We're just crashing through any of the ceilings we thought we had," said Art Kinsman, director of Government Affairs for AAA. "We may be looking at a new record-high price before the end of the year."
In May, gas prices reached a record national high of an average of $3.22 a gallon.
Many drivers like the Talbots are already cutting back on gas consumption. Or, like Paradis, they are working more to pay for their driving.
"We have a lot of work down in Massachusetts - Marblehead, Hamilton, Wenham," said the owner of Paradis Plumbing and Heating in Plaistow, N.H. "If it gets much higher, you keep going. Keep answering the phone."
Barbara Talbot of North Andover and her family have cut trips to their vacation home in Freedom, N.H.
And Maurice Lynch, 68, of North Andover is keeping his travel local.
Gas prices, hovering close to $3 a gallon here, are fueling the angst of some local drivers. This time last year, on average, drivers were paying about $2.19 a gallon.
"I can't stand paying for gas," Talbot said as she filled up her Toyota Highlander. She and her husband traded their larger Toyota Sequoia to save money when gas prices first reached, then topped, the $3 a gallon mark in 2005.
The forces driving prices up this time aren't much different. Uncertainty over the future of oil from the Middle East, increased demand for oil from China and India, more people driving SUVs and the additional demand for gas for holiday driving and shopping all are driving the cost of oil up, said economists interviewed for this story.
"It goes in ebbs and flows," said Robert J. Cuomo, dean of the Girard School of Business and International Commerce at Merrimack College in North Andover. "It depends on what the mood is, in terms of uncertainty. Markets get spooked. People become paranoid and start to hoard. The demand goes up, and the price of gas goes up."
This time, the declining value of the dollar against the Euro has made importing gas more costly, and the price of crude oil is edging toward $100 a barrel. In 2005, the price for a barrel of oil was $70. As a result, some experts worry gas prices might be in for more of a jump.
"We're just crashing through any of the ceilings we thought we had," said Art Kinsman, director of Government Affairs for AAA. "We may be looking at a new record-high price before the end of the year."
In May, gas prices reached a record national high of an average of $3.22 a gallon.
Many drivers like the Talbots are already cutting back on gas consumption. Or, like Paradis, they are working more to pay for their driving.
"We have a lot of work down in Massachusetts - Marblehead, Hamilton, Wenham," said the owner of Paradis Plumbing and Heating in Plaistow, N.H. "If it gets much higher, you keep going. Keep answering the phone."
Jack Kennedy is in the same boat. The Methuen man drives a limousine for Westford-based Corporate Coach & Limousine. The company isn't passing the cost of rising gas prices onto its customers, and that's hurting the drivers, who are responsible for fueling their cars.
"It's getting tight," he said.
Lynch of North Andover drives a 2003 Chevrolet Trailblazer. While he travels locally and typically only puts about $30 a week into his SUV, rising gas prices still hurt. The same $30 doesn't take him as far as it used to.
"When you're on a fixed income, it's tough," he said.
There is a silver lining, sort of. If people continue to struggle and stop buying as much gas and the demand goes down, so will the price.
"If traders start to get wind that the economic situation is decreasing demand (and) people are cutting back, that could start to creep in and stabilize the prices," Kinsman said.
It is unlikely that prices would hit $4 a gallon for gas, said Kinsman, who said such predictions in the past were "irresponsible." With no new wars and no disruption in the oil supply, market forces would likely keep prices from reaching the $4 level, as they did in 2005, he said.
That's good news even for those who drive gas-efficient cars.
"I can handle it up to now," said Bart Cahill, 73, of North Andover, putting gas in his 2000 Honda Civic at a local gas station. "I hope it doesn't go any higher."
BOX 1: You think it's bad here?
Gas prices in other parts of the country differ because of distance from ports, supply disruptions or competition in the local market.
* California - $3.34
* Hawaii - $3.20
* Florida - $3.10
* North Dakota - $3.20
* Massachusetts - $2.95
* New Hampshire - $2.95
Source: AAA
BOX: History of gas prices
* 1950 - 27 cents
* 1970 - 36 cents
* 1990 - $1.15
* 2007 - $3.06
Source: U.S. Department of Energy
How can I save money on gas?
* Bundle errands - try not to take extra trips out.
* Slow down. The faster a vehicle goes, the more fuel it uses.
* Avoid quick starts and sudden stops.
* Keep vehicle maintained, check tire pressure.
Source: AAA
