Why are gas prices so high?
This is a question gas station owners, managers and employees have to answer repeatedly every day. In June 1999, the average gas price per gallon was $1.12. So far this month, the highest price has been $1.89 per gallon.
An area gas station employee felt the increase in gas prices this summer when she traveled to North Dakota with her horses. Last summer, the drive cost her $150 for gas; this year it cost her $311.
Customers have blamed gas station owners for the high gas prices, while other dealers have been in contact with more understanding people.
"The public is pretty understanding," said Marge Hillman, manager of Freedom Valu Center in Brainerd. "They know it's not us and it is the wholesalers."
"We get blamed for everything," said Rose Payne, manager of Staples Self-Serve. "People tend to blame us out of frustration and some understand that we are not at fault. "
She said many of the customers are locals where everyone knows each other so the people tend to be more understanding. Payne said she hates to see everyone so unhappy.
"People talk about it, but it's not as bad as people think," said Neil Schmidt, owner of the Y Store in Merrifield. "Last year's summer prices were so low, so now it just seems to be so much higher. People are understanding."
Schmidt said in the 1980s everyone had smaller vehicles and gas was cheaper. Now trucks and sports utility vehicles are more popular yet get fewer miles per gallon of gas.
"I hardly ever see a small car anymore," he said. "I also feel bad for the truck drivers on the road. It hits their pocketbooks much harder."
"It's no secret," said Brad Holland, owner of the Brainerd Triangle Store. "We hate to see the gas prices go up, too. It costs us more."
Holland said he buys Phillips products and whatever the price is, he has to pay it. He said about 40 cents per gallon of the cost of gas is strictly for state and federal taxes.
"A lot of people want to blame the person in front of them," said Steve Stohr, owner of West Brainerd Amoco. "We hear a lot of crude remarks. We try to explain it (the gas prices) to the people who don't understand.
"And I agree, it is overpriced. It costs us a fortune."
Kelly Bevans, owner of Brainerd Mobil, said he has not heard too much complaining about gas prices, but it does come up in discussions. He said the wholesaler may increase gas prices each day and the retailer will try to retain the price as long as possible. When he can't take it anymore, the retailer will raise the price.
"There is no negotiating with the wholesaler," he said. "There is nothing we can do."
Competition among gas stations also plays a role in gas prices. Gas is the only product advertised on a sign to display prices every day. So owners do not have to call around to see what other stations are charging for gas, they just have to look out their window or walk down the street.
Stohr, whose main product used to be gas, said today there are three times as many gas stations, there's no profit and it's hard to find help. He also said a lot of the bigger corporations are squeezing the smaller companies out of business. The bigger companies buy gas in larger quantities and may receive a better price. Stohr buys gas in one tank that holds 8,000 gallons at a cost of $15,000. With gas prices at $1.79 per gallon, it would be a $680 profit.
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