Gas prices reach record high

Covered in drywall mud splatter, Mike Merrill pumped gas into his truck Tuesday afternoon. Driving to jobs is costing him about $50 a day lately, eating into his drywall business profits.

"It kills us," Merrill said.

Gas prices reached an all-time record high in Nevada on Tuesday, costing consumers an average of $2.25 a gallon. In Carson City, drivers paid as much as $2.33 a gallon for regular unleaded.

The state had the fourth-highest average price in the nation, tied with Washington. California was highest at $2.31, followed by a tie between Oregon and Hawaii with $2.27 averages.

Bob Lamkin, owner of Bob's Shell in Carson City for 26 years, has his eye on the rising prices and takes notes. The price Tuesday was 19 cents higher a gallon than the highest reached in August last year, he said.

"This is the highest I have ever seen it," Lamkin said. "I keep track of this stuff. People get upset because they're looking at it now as they're paying $2.33 a gallon, instead of 19 cents more than in August."

Gas prices could continue rising into Memorial Day weekend and through the end of summer, said AAA spokesman Sean Comey. The price jump is being attributed to global uncertainty and an increase in consumption that is meeting production levels and leaving few reserves, Comey said.

"The best we can hope for right now is that prices won't go up any farther," Comey said. "And they're unlikely going to go down significantly anytime soon. They very possibly could continue to go up."

OPEC announced it has scheduled an emergency meeting to discuss production of crude oil, providing meager hope that a rise in production could lower crude oil prices. Crude oil prices reached $41.07 a barrel yesterday - almost $1 a gallon.

Nevada is also suffering from a minimal fuel supply following a pipeline break in California two weeks ago. Historically, the state keeps a tight balance between supply and demand and produces only as much gas as consumed. Any small disruption can add to the problem, Comey said.

A plant switchover added to the storage shortage this week, said Peter Krueger, state executive for the Nevada Petroleum Marketers and Convenience Store Association.

"All the fuel coming in Sunday went right back out," Krueger said "We're slowly catching up now."

With consumers expected to buy less gas, the high prices affect station owners and convenience store operators, Krueger said.

"When people buy less gas, the people with convenience stores see a decline with slots, Twinkies and milk," Krueger said. "It has a significant impact on our members."

Also, higher prices mean the 3 percent credit card rates paid by stations cuts farther into the 8- to 10-cent-per-gallon profit margin.

Despite high gas prices, AAA announced Tuesday a record number of Americans are expected to travel this Memorial Day holiday. Travel is estimated to increase by 3.6 percent, with 36.9 million Americans traveling 50 miles or more from home.

Contact Jill Lufrano at jlufrano@nevadaappeal.com or 881-1217.

Gas prices in Carson City

TUESDAY:

Shell

$2.33 regular, $2.43 plus

Costco

$2.19 regular, $2.39 premium

Mirastar

$2.19 regular, $2.29 plus

AM/PM

$2.23 regular, $2.31 plus

Exxon Country Store

$2.23 regular, $2.33 plus