High gas prices cramp local pockets

Rising world prices of oil impacted prices of fuel in the CNMI, with its two retailers—Shell and Mobil—increasing pump rates by at least 12 times in 2005 for a cumulative gallon price adjustment of up to 67 cents.

The fuel price hikes not only hurt motorists’ pockets but also exacerbated the ability of private companies to weather the CNMI’s economic slowdown, while the government-run Commonwealth Utilities Corp. had to implement a fuel surcharge on top of households’ power consumption charges.

On Jan. 28, Shell hiked retail prices on Saipan by 7 cents per gallon, its first for the year. Shell said the high demand for fuel in China placed pressure on worldwide prices of petroleum products—sourced out from Singapore—as the world’s most populous country surged economically and militarily.

Mobil followed suit. Both companies would increase pump prices almost every month until September, making gas prices soar to a high $3.459 during the year.

In late April, Shell and Mobil decided to lower pump prices by 10 cents per gallon, their first price rollback for the year. Mobil, which rarely releases media advisories regarding its fuel price hikes (although its rates were usually at par with Shell’s), publicly announced at that time that it would pass on savings to its consumers following the easing of Singapore prices.

Due to the rollback, Shell’s gallon prices on Saipan dipped below the $3-mark, except for diesel, which retailed at $3.009 per gallon. Mobil’s super unleaded gasoline, the counterpart of Shell’s premium, and diesel remained at $3.029 per gallon at full-serve rate, while the rest of its fuel prices settled slightly below $3 per gallon.

On May 19, Shell again lowered prices by 10 cents a gallon, pulling down all pump rates below $3 per gallon. The rollback, Shell’s second for the year, would be followed by successive prices increases that at times were implemented twice or thrice in a single month. The trend in rising prices continued until late September.

As for Shell, its 12th price hike and last for the year raised fuel cost to a high $3.459 for premium gasoline at full-serve rate. Mobil sold its super unleaded gas at the same retail price at full-serve rate. The gas rates became one of the highest compared with average prices across the nation.

The Saipan Tribune’s monitoring of gas prices recorded Shell’s highest gallon prices for the year as follows: regular, $3.299; diesel, $3.349; and premium, $3.459. During the same period, Mobil stations on Saipan pegged unleaded gas at $3.299; super unleaded, $3.459; and diesel, $3.329.

On Oct. 26, Mobil broke the trend in rising prices by implementing a 10-cent reduction in gallon prices. Shell made a similar move the following day, rolling back prices by up to 12 cents a gallon. The oil companies said the easing of product cost in Singapore resulted in their decisions.

Following the October price reduction, both companies lowered their pump prices on Saipan twice more—one in November and the latest one in early December. Both Shell and Mobil reduced pump prices by 6 cents a gallon during the first seven days of December.

To date, Shell stations retail regular gasoline at $2.929 per gallon at self-serve rate—the only rate below $3 per gallon. At full-serve rate, the product costs $3.059 per gallon. Premium gasoline retails at $3.219 and $3.099 per gallon at full- and self-serve rates. Shell’s diesel has settled at $3.149 per gallon.

Shell’s price hikes in 2005—and the rollbacks—resulted in a net gallon price increase of 43 cents for premium gas, 37 cents for regular gas, and 40 cents for diesel.

Mobil retails regular gas also at $2.929 at self-serve rate. Like Shell, prices of other petroleum products at Mobil stations on Saipan have remained at over $3 per gallon. At full-serve rate, Mobil’s regular gas sells at $3.099.

Mobil’s super unleaded gas sells at $3.259 and $3.099 per gallon at full-serve and self-serve rates, respectively. The rates for diesel have settled at $3.149 and $3.099.