$3 gas to hit Denver soon

Gargi Chakrabarty, Rocky Mountain News

Published April 26, 2007 at midnight

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Denver is seeing a severe crunch in gasoline supply, and pump price likely will top $3 a gallon in the coming days.

Oil refinery problems in Texas and Oklahoma which supply Colorado with gasoline through pipelines are the root cause of the problem, and the supply crunch is being exacerbated by rising demand ahead of the busy summer driving season.

Pump price, in fact, could inch toward $4 this summer if any event, such as a severe hurricane or a political fallout in an oil-producing nation, further squeezes already tight gasoline supplies.

"There is no gas in Denver," said Bryant Gimlin, energy risk manager at Fort Lupton-based Gray Oil Co., a wholesale distributor of gasoline and diesel. "The situation here is worse than how it was after Hurricane Katrina."

Several gas stations ran out of fuel in past weeks, covering the pumps with yellow plastics and diverting drivers to nearby stations. Others say although they got timely truck deliveries, the fuel was priced too high.

A Conoco station at 724 S University Blvd. sold regular, unleaded gas at $2.99 a gallon on Thursday. Colorado's average price was $2.856, and Denver was $2.805. And it likely is a matter of days before price hits $3.

"We are going in to the peak driving season with the lowest inventories we have had," said Roy Turner of the Colorado Wyoming Petroleum Marketers Association which represents half the states' gasoline dealers. "It doesn't look good right now.

"No doubt we will have $3 a gallon," Turner added.

When adjusted for inflation, the highest U.S. average retail gasoline price was $3.079 a gallon in March 1981, the Energy Information Administration said. Colorado came close to that mark on Aug. 11, 2006, when it hit $3.076.

On Thursday, the national average for gasoline stood at $2.877.

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