Gas expected under $3 next week

Trick or treat? Definitely treat.

By Halloween or the day after, Kaua’i motorists will be seeing gasoline prices below $3 for the first time in many months.

Members of the state Public Utilities Commission (PUC) on Wednesday lowered the maximum pre-tax wholesale price of gasoline by 18 cents.

The weekly maximum pre-tax wholesale price of a gallon of gasoline for the seven-day period from Monday, Oct. 31, to Sunday, Nov. 6, for Kaua’i, was set by PUC members at $2.06, or 14 cents lower than O’ahu.

To determine what drivers will likely pay at the pump on Kaua’i beginning next week, take that base price of $2.06, then add about 61 cents in taxes, and the total is $2.67. Add the dealer mark-up at the pump, which is not capped, and which on Kaua’i can be any where from 18 cents to 30 cents, and the price of a gallon of unleaded regular gasoline likely will be in the $2.85-plus range.

This is about $1 less than motorists were paying during the week of Sept. 12-18, when gas prices neared $4 in the aftermath of Hurricane Katrina.

Gas prices, as expected, fell about 12 cents this past week, but retailers dropped their prices in stages, some waiting till Wednesday to drop from $3.16 to the $3.04 range.

For a brief shining moment, the reported price of gasoline dipped below $3 Tuesday, as owners and operators of the Hanamaulu Service Center Shell station held their weekly, four-cents-off Tuesday, with regular unleaded gasoline at $2.99, about 17 cents lower than competing Lihu’e stations.

“I see it as an attempt by some local retailers to do some capitalizing on the prices, though some of it might also be leftover inventory,” said Martin Rice, author of the weekly Rice Report, a survey of prices and trends at all 20 of Kaua’i’s service stations.

Rice said Sunday fuel deliveries could also be effecting gas prices set by retailers.

Rice, who is the chairman of the Kaua’i Democratic Party, said he thought the gas-cap law, the only one of its kind in the nation, was “working, to an extent.”

The price of gasoline has plummeted 74 cents in the past three weeks.

The state gas-cap law, which went into effect Sept. 1, does not put a cap on how much retailers may charge.

The weekly cap established by PUC members sets the maximum amount officials at the oil companies can charge for wholesale gasoline.

The baseline price established by members of the state Legislature under the wholesale-price-cap law and used by PUC members is the weekly average of the daily spot price for Los Angeles, the U.S. Gulf Coast, and New York.

On Aug. 30, just prior to the start of the gas-price law on Sept. 1, the average price for regular unleaded was $2.91 a gallon, according to AAA. Next week, the expected drop should put Hawai’i below what prices were before the law went into effect, said state Rep. Marcus Oshiro, D-Wahiawa, House majority leader.

“We asked consumers to give this law some time because of the two hurricanes, and we’re finally starting to see a much-truer picture of how the law was intended to work.”

Kaua’i gas prices surveyed by Rice are now available at The Garden Island Web site, www.kauaiworld.com. Go to left side navigation bar and click on “gas prices.”

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