COLORADO SPRINGS — Gas prices went over $2 for the first time in Colorado Springs in May.

Two gas stations hit the all-time high, with a Conoco in the southern part of the city leading at $2.059.

Oil industry officials got to explain why some retailers charge more than others when the Colorado Springs Gazette asked for comment in response to a 10-week survey it conducted, showing a wide disparity in fuel prices, as much as 18 cents a gallon.

The price rise followed a general trend in the industry with lower prices at grocery stores and higher ones near the interstate. The hypermarkets ' grocery stores and warehouse clubs that sell gasoline ' take a reduced profit to get people in their stores.

Location of the station must be taken into account in placing a gas station. If you buy or lease in a more expensive part of town you will have higher overhead that must be compensated for, said Bill Bush, spokesman for the American Petroleum Institute in Washington D.C.

Those lucky enough to snag a location just off the interstate not only get a lot of business but can charge a higher price for the convenience they provide motorists.

On two occasions during the Gazette"s survey prices differed by 18 cents a gallon across town. On one date Shamrock stations on the city"s east side were selling gasoline for $1.359 a gallon, while a 7-Eleven store on the south side priced gasoline at $1.539 a gallon.

During the Gazette"s survey stations carrying the Sinclair brand on the north and west sides posted the lowest prices, averaging $1.634 a gallon. The most expensive were two BP Amoco stations, one on the south and the other on the north.

The price retailers pay suppliers isn"t the only factor in determining the price at the pump.

Margaret Chabris, spokeswoman for 7-Eleven Inc. said store operators check competitors" prices in their areas each day and feed the information to headquarters. There, analysts study the information and, based on other factors such as wholesale costs, send back prices for the stores to post.

Diamond Shamrock"s parent company, Valero Energy Corp. had this to say: "Pricing is the least scientific part of our business. It literally is competition corner-to-corner across America."

One gas station owner told the Gazette, "We"re one of the only industries in the country that posts the price in front of everybody."

Colorado Springs wasn"t the only city to reach $2 a gallon. Across Colorado the average price on May 23 was $2.006 a gallon.

FORT COLLINS — Blue Sun Biodiesel will soon add eight more sites in Colorado for selling its mix of specially refined vegetable oil and diesel fuel.

The latest added were in Colorado Springs and Pueblo on May 20.

The fuel costs about 20 cents a gallon more than diesel, but Blue Sun is promising better performance because the blended fuel ignites faster than regular diesel fuel.

COLORADO SPRINGS — Come hell or high water or higher gasoline prices, most owners of gas guzzling SUVs aren't giving them up.

Sales of big vehicles are brisk here, and owners say they have no intention of trading in their Expeditions, Suburbans, Hummers and Sequoias.

Sales and leasing professional Jack Marcus said few people seem interested in the smaller cars. "I'm amazed that the big cars are selling as good as they do," he said. Marcus drives a Suburu, but his wife is staying with their Lincoln Continental. "She says if she gets hit, she wants to be around to put in another tank of gas," Marcus said.

Safety, roominess, the Colorado terrain and weather are the most common reasons mentioned by owners of SUVs for driving the larger vehicles.

Jack Colsten, owner of Al Serra Chevrolet, said motorists are "willing to trade gas prices for safety and a place to put the kids." His dealership is seeing a good first quarter with SUV sales up considerably over last year.

Even while gasoline prices are soaring here, he sold 28 Humvees.

Small cars aren't being left out of the picture if they have something to offer.

At a Toyota dealership here there is a four-month wait to buy the new Prius. Ken Wroblewski, new vehicle manager, said he sold five in one day recently.

The car is powered by a combination of gas and electricity. It charges itself every time the brake is pressed and switches to gasoline on the highway. The Prius is about the size of a Toyota Camry and costs $21,000 to $28,000.

DENVER — Carjackings aren't new. Neither are carjackings at the gas pump.

But a man in drag trying it?

That's what happened May 22 at the 7-Eleven at 1000 E. Colfax Ave. as astonished customers and employees looked on.

The man, wearing a dress and a red wig, came running to the pump area where he first jumped into the bed of a truck, then apparently not finding it comfortable, leaped out and tried to carjack a vehicle from someone pumping gas.

Unfortunately for the luckless crook, police were right behind him. He had just crashed another vehicle into a fire hydrant after carjacking it at knifepoint from two men working on it in an alley not far away.

The carjacker identified himself as Brandy Michelle Dunn. By the time he was led away in cuffs, his face was as red as his wig.

DENVER — The Environmental Protection Agency has ordered seven counties in and around Denver to switch to cleaner-burning gasoline by June 1 to reduce the metropolitan area's chronic air pollution problem.

Oil industry officials say it will add a few more cents to an already burgeoning price per gallon which is expected to reach $2 to $3 this summer and the entire state is likely to be affected.

"It just is not practical for the industry to produce a Denver blend of fuel and not have that be the same fuel used by everyone," said Harlan Ochs, president of Acorn Petroleum, a Colorado Springs distributor of Phillips products.

The price in Colorado Springs has risen 30 cents per gallon since the first of the year, reaching $1.73, about four cents below the city's all-time high in June, 2001.

But the tourist industry, on which Colorado depends for much of its revenue, isn't worried yet.

That's because the sale of gas-guzzling SUVs and pickup trucks has increased in the state.

And a Denver gas station owner said, "People will grumble but I don't think they'll cut back on their driving, at least by much."

Originally published in the June 2004 issue of the O&A Marketing News.
Copyright 2004 by KAL Publications Inc.