Gas Prices Plunge Below $2/Gallon in Straits Area

2008-11-27 / Front Page

Some Say Pocketbooks Already Feeling Relief
By John S. DeMott

Greg Yoder of Mackinaw City gets a trim in St. Ignace from Steve Dufresne. Mr. Yoder said with the recent dip in gas prices, he expects his fuel bill to be about half what it was last year for his landscaping and plowing business. Greg Yoder of Mackinaw City gets a trim in St. Ignace from Steve Dufresne. Mr. Yoder said with the recent dip in gas prices, he expects his fuel bill to be about half what it was last year for his landscaping and plowing business. Gasoline prices are plummeting, in many cases dipping below $2 a gallon and likely to head lower as the holiday driving season looms. Local drivers say they welcome the relief on their business and household budgets.

Fuel prices the week of November 17 were falling, literally by the hour, causing Brandon Rairigh, a station owner with his wife, Jacie, to trudge to the price signs outside their Shell station in DeTour and, with a suction-cup equipped pole, lower prices for unleaded regular to $2.13 for unleaded regular and $3.02 for diesel.

"Our oil wholesaler faxes us the information," said Mrs. Rairigh. "We spend most of 24 hours a day here, and we watch the fax constantly."

Steve Autore of Autore Oil and Propane in Cedarville, which manages nine BP, Shell, and Mobil stations in the Eastern Upper Peninsula, said prices were behaving like they usually do: "They go up in a hurry and they go down in a hurry."

At right: Arlan Winslow, retired chief of police of Imlay City, filled up at the BP station on US-2 at St. Ignace Saturday and said, "I'm happy. I thought I'd never see this price again." At right: Arlan Winslow, retired chief of police of Imlay City, filled up at the BP station on US-2 at St. Ignace Saturday and said, "I'm happy. I thought I'd never see this price again." While $2 gasoline has just returned, for some, like Greg Yoder of Mackinaw City, the lower prices already are showing up on his bottom line. He's in the landscaping business in summer and, in winter, plows snow from driveways and parking lots for residences and commercial customers.

He expects his fuel costs will be half the $1,800 they were last year.

"I get around six miles a gallon when I'm plowing, so it really helps," he said. "My prices are the same as they were last year."

Timmy Lee, owner of Timmy Lee's Pub on US-2 near St. Ignace, now drives his Dodge Ram into St. Ignace every day with impunity to buy meat and fish from suppliers, instead of cramming all chores into a single trip, as he did last summer when fuel was above $4. He can visit his daughter, Lakon, in college in Traverse City every other week instead of every other month, he said.

Gabriel Noel, a filmmaker from Ontario who stopped to gas up at St. Ignace Saturday, November 22, said he's paying "about half what I paid in summer" for gasoline now. Gabriel Noel, a filmmaker from Ontario who stopped to gas up at St. Ignace Saturday, November 22, said he's paying "about half what I paid in summer" for gasoline now. Vince Ingalls, one of Mr. Lee's bartenders, said, "You're looking at around $50 to fill up, compared with two or three times that before. That's money for going out to eat, for movies."

Like at the Rairighs' place in DeTour, not all EUP prices were below $2, principally because of higher transit costs. In Pickford, they still were at $2.09 for unleaded regular, with diesel at $2.94 last week.

"I've been gone and I just got back to this. I never thought it would go this low," said Midpoint Marathon station owner Kathy Christensen at Pickford. Her prices were far below their summer peak of $4.69.

The falloff couldn't be more welcomed by area motorists.

"People are a lot happier to see it going down than up," said Courtney Sumerix, a clerk at Holiday in St. Ignace. Holiday's highest gasoline price at the start of summer was $4.29.

In St. Ignace, pump prices for regular unleaded on US-2 at Shell late last week were $1.95, at Holiday $1.94, and at BP $1.95, prices not seen since 2005.

"I'm paying about half what I paid in summer," said Gabriel Noel of Ontario, a Kalamazoo-bound filmmaker at the US-2 Shell station.

Arlan Winslow, the retired chief of police of Imlay City, filling up at the BP station on US-2, said, "I'm happy. I thought I'd never see this price again."

Even diesel fuel was lower, although not as low as gasoline. It was going for $2.95 at Shell in St. Ignace and $2.90 at Holiday, compared to a range of $4.50 to nearly $5 in some areas of northern Michigan last summer.

Friday, November 21, lower prices were portended by skidding crude oil, which dropped to $48 a barrel on futures markets, compared to $145 last summer. With the U.S. in recession and deflationary pressures evident in housing prices and many other economic sectors, there were some predictions on Wall Street that crude could drop to $40 or lower, meaning still lower prices to come at the pump.

It was such good news that hardly anyone last week believed the low prices could last.

Mark Douglass of Traverse City said, "At some point in time, I'm sure they're going to go back up."

"They'll be back up again in January," said Mr. Yoder, getting his hair cut at Steve Dufresne's barbershop on US-2 in St. Ignace. "We'll see another dollar a gallon, with the government, with the economy, and everything. That's just my feeling."

Mr. Autore of Autore Oil speculated long term forces probably won't let gasoline prices fall much more.

"Demand is down," he said, referring to the 65 billion or so fewer miles that motorists drove during the last two years. That works against rising prices. But countering that, refining capacity is in short supply, which can make prices at the pump go up, as can any number of other events.

Local gasoline prices Monday, November 24, were around $1.89 per gallon.

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