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Keeping an eye on gas supply

State’s fuel costs still top national average

POSTED: October 15, 2008 5:01 a.m.
TOM REED/The Times

While this Citgo station on Atlanta Highway offers some of the lowest gasoline prices in Gainesville, many other stations have prices higher than the national average.

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In light of current market conditions, trying to set the day's gas prices is proving to be a slippery slope for area convenience store owners.

"The problem is that a lot of people want to drop their price for gas, but they are also watching their inventory, so they don't want to go too low because they are afraid of running out," said Jay Dossani, owner of Jay's Food Mart on Thompson Bridge Road in Gainesville.

As of Friday afternoon, Dossani was offering regular gasoline for $3.49 a gallon. Although that price is 9 cents cheaper than the average price of regular gasoline in Georgia, according to a AAA fuel-gauge report, it is also 9 cents higher than what Dossani offered on Thursday.

"(Thursday) I was selling regular gas for $3.40 per gallon, but those long lines started forming again and I thought that I was going to run out, so I had to raise the price," Dossani said. "At this price, the lines have died down, but I will probably still run out soon."

Like most other convenience store owners in North Georgia, Dossani is keeping a close watch on his fuel supplies lately after having to deal with the fuel shortages of the past several weeks due to complications of Hurricanes Ike and Gustav. Fuel delivery supplies have been erratic to the area for the past several weeks and are beginning to become more regular, although delivery loads are still not back to their usual volume.

"Normally I would get 8,000 gallons of gas every two days, but now that is down to 2,500 or 3,000 gallons," Dossani said.

More gas equals lower prices for customers at the pump. During the height of the gas shortage crisis, Georgia customers were paying upwards of $4 per gallon for regular fuel, according to a AAA fuel-gauge report. Now those prices are down to $3.58 per gallon of regular gas. That's still far above the average last year at this time of $2.70 for a gallon of regular-grade gasoline.

Although fuel costs are returning to more reasonable rates in Georgia, the state average cost of fuel is still higher than the national average - a trend which used to be reversed. According to the AAA, the national average for a gallon of regular fuel is $3.35, which is 23 cents lower than what Georgia customers are paying.

As store owners wait for their gas supplies to return to normal, many are having to play a balancing act between meeting the demands of their customers and those of their own financial obligations.

"We try to keep our rates reasonable, but we can't drop them too low because our bills are still the same," Dossani said.

"Since supplies have been down, we've run out of gas seven or eight times and that made our inside sales drop by like 40 percent. When there's no gas, people don't come inside to shop. So now we are trying to keep the prices low because that draws more customers inside the store to buy other things and that helps, but if we go too low then we run out and we're back where we started."

The Governor's Office of Consumer Affairs confirmed Friday that it is seeking records from a number of stations in Northeast Georgia in connection with alleged price gouging following the disruption of gasoline deliveries after Hurricane Ike. Spokesman Shawn Conroy did not identify the stations by name, but said they are among 166 statewide now being served with subpoenas for their pricing records. He said there was one station in Hall County, four in Forsyth, three in Jackson and one each in Habersham, Lumpkin and Dawson counties that are in the process of being served.

There have been reports of prices as high as $9.99 for a gallon of unleaded regular gasoline.
The state prosecuted a number of cases following Hurricanes Katrina and Rita for price gouging. The fine is $2,000 per violation, plus restitution to the customers.

Conroy said only one station fined during the previous hurricanes has been mentioned as a possible repeat offender.



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