Why are gas prices higher?

May 7, 2009 3:23:22 PM PDT
Bunky Morgan is no newcomer to the service station game."I've been in the gasoline business for 51 years," he told Eyewitness News.

But Morgan says he really does not understand why pump prices are creeping up again.

"We've had a 24-cent increase in the last eight days," he explained.

With the economy slowdown, people are driving less. Gas demand is down about 5-percent, but meantime, the federal government says national inventories of crude oil, the main ingredient of gas, are at a 19-year high.

"19 years? It's unreal," said Morgan. "Oil companies run this country. I'm sorry."

But, the oil industry says it's been hit like everyone else in this recession.

"The reality here is if you are in the furniture business and you're making end tables, and they aren't selling very well, you don't spend all day making end tables. And the same is true in the oil business," offered Bill Weatherspoon with the NC Petroleum Institute.

Government data also says as there is more oil sitting idle in this nation. Refineries have been running at less than 90-percent capacity for the last 14 months.

"If you're in the oil business, and demand is low, the economy is in trouble, there are bailouts in other industries that are popping up the system. When you see that, you tend to cut back on your refinery," Weatherspoon explained.

But even a gas retailer does not like the math.

"I think the government needs to step in and do something. They're trying to regulate everything else. Why not the oil companies?" Morgan asked.


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