BELLINGHAM — As usual, area motorists are paying the state’s highest prices for gasoline.
Data from AAA Washington showed regular gas prices averaging almost $3.21 per gallon in the Bellingham area Wednesday, about eight cents short of the record set in late May 2006.
Bellingham’s gas prices are the highest of any metropolitan area in the state, according to AAA: Prices average 8.5 cents a gallon less in Bremerton and 6.6 cents less in the Seattle-Everett area. In Spokane, the average price is still below $3 a gallon.
SOME PRICE GAPS SHRINK
Sign Up and Save
Get six months of free digital access to The Bellingham Herald
The price gap between Bellingham and other Western Washington cities, while still significant, appears to have narrowed a bit in some cases. A year ago, the gap between Bellingham and Bremerton gas prices was about 20 cents. The gap between Bellingham and Tacoma prices was 15 cents a year ago and about seven cents on Monday.
SOUTH SAW PRICE BREAK
Mike McEvoy, a partner in McEvoy Oil Co., said he thinks the gap may narrow even more in the months ahead because refiners seem to be backing away from the “zone pricing” strategy that gave retailers in urban areas to the south a break on prices, in the belief that competitive pressures were greater there.
“Up in Whatcom County, we’ve not been given a fair shake,” McEvoy said. “You’re going to see some leveling out in the next month or two.”
But that will likely mean higher prices in Seattle and Tacoma, not lower prices here.
Tim Hamilton, executive director of Automotive United Trades Organization, said the gap between Whatcom County and the rest of the state may be shrinking because gasoline retailing has become a bit less competitive to the south. Refiners are now charging higher prices to retailers in those areas.
SOME LOCAL RETAILERS CAN’T BUY DIRECT
Hamilton also observed that retailers in areas to the south of Bellingham are more likely to get their supplies direct from refiners. Bellingham area retailers are more dependent on local distributors for gasoline supplies, and that means an additional markup at local stations.
McEvoy agreed that is the case.
“That’s another reason why pricing (here) is a little bit higher,” McEvoy said.
McEvoy’s company owns seven stations: Four are Shellbranded, two are Texaco and one is Mobil.
McEvoy said all the gasoline sold at those stations comes from the Shell refinery in Anacortes, and they all start with the same basic fuel. Additives unique to each brand are added as the fuel is pumped into trucks for distribution.
Hamilton said some Whatcom County stations are supplied from terminals as far away as Seattle, so the presence of two local refineries doesn’t mean cheaper gas here, any more than the presence of cows means cheaper milk.
Officials at Keith Oil Co. and Yorkston Oil Co. did not respond to requests for comment.
CANADIANS MAY SPUR LOCAL DEMAND
The presence of Canadian visitors may also be a source of upward pressure on prices here. Gas in British Columbia has been selling at close to $3.50 a gallon, and Canadians cross the border by the hundreds of thousands every month.
Statistics on the number of gas pumps in Whatcom County appear to bear out the theory that visitors are generating much of the local demand for gas. The Washington Department of Agriculture tests the accuracy of every gas pump in the state, and their statistics show that Whatcom County has one gas pump for every 82 people. Statewide, that statistic is one gas pump for every 147 people.