Gibbons orders study of rising gasoline prices

CARSON CITY — Gov. Jim Gibbons ordered his energy director today to investigate why gasoline prices in Nevada are climbing so dramatically, but an AAA spokesman said she likely will find prices are higher because of the declining value of the dollar.

Gibbons asked state Energy Department Director Hatice Gecol to research the problem and explore possible solutions to the burden high prices place on residents and tourists.

“Millions of tourists drive to Nevada, so we need to find out why gas prices have risen so quickly and see if there is anything we can do about it,” Gibbons said in a prepared statement. “I am working to get more tourists to come to Nevada so I need real facts to see if there is anything we can do about this problem.”

He made the request of Gecol following an American Automobile Association release that the average price of gasoline — self-serve, low-lead — is now $2.67 in Arizona, $2.74 in Nevada and $3.02 in California.

Those prices are an increase of more than 50 cents per gallon in the last two months and almost $1 more than the low for December.

Michael Geeser, AAA’s spokesman and legislative lobbyist, said he was pleased Gibbons is looking into gasoline prices. AAA daily compiles the price of gasoline in Nevada. But he noted gasoline prices are set by international markets and investors.

“Gas prices have little to do with supply and demand,” he said. “Gas supplies are plentiful and the demand is low. It has everything to do with the value of the dollar.”

He said crude oil is sold in U.S. dollars and the value of the dollar is dropping versus the Euro and other currencies.

“If you hold other currencies your money goes further, so investors make more by putting their money in crude oil,” Geeser said.

The price of a barrel of crude oil topped $71 briefly today, but then fell back to about $69. These are the highest prices in six months, but far below the $140 per barrel that crude oil sold for in June 2008.

But the good news is the price of gasoline today in Las Vegas was $2.72, down $1.55 gallon from the $4.27 per gallon on the same day in June 2008.

In Reno, gasoline sold for $2.74 per gallon today, compared with $4.22 on June 26, 2008, according to AAA.

Daniel Burns, Gibbons’ communications director, acknowledged they might find there is nothing that can be done about gasoline prices. But he added there are vast differences in the prices charged for gasoline in California, Arizona and Nevada that are not explained by the declining value of the dollar.

He said the governor was in Laughlin on Monday where gasoline sold for $2.60 per gallon, but directly across the river in Bullhead City, Ariz., it was selling for $2.30 per gallon.

“There are anomalies that don’t make sense,” Burns said. “We have heard a lot of explanations.” Geeser said he applauds Gibbons for his effort.

“I am not sure they are going to find anything, but it is great they are taking a look.”

Contact Capital Bureau Chief Ed Vogel at evogel@reviewjournal.com or 775-687-3901.