Rapidly rising gas, oil prices hammer LI

Fast-rising gasoline and heating oil prices are hammering Long Islanders.

Monday's average price of regular unleaded gas is up 58 cents a gallon from a year ago to $3.43, and diesel is up almost 70 cents, to an average of $3.81. Heating oil is averaging $3.75 a gallon -- almost 74 cents higher than a year ago.

Across Long Island, residents and business owners are making changes to reduce costs as they face the squeeze caused by higher prices.

Ute Pelz, 58, of Commack, and her friend, Diane Neukirch, 49, of Smithtown, are not happy with the steady creep in gas prices, but with news of more unrest in North Africa and the Middle East, they are bracing for their gasoline expenses and heating oil prices to go even higher.

"If it goes up to $4, what are you supposed to do?" Pelz, a mental health counselor, asked Monday as she waited to fill her Ford Explorer at a Smithtown gas station. "It will be hard to manage, moneywise."

Both women said they already had cut back on trips to see family, combined errands to use less gas and began using their fireplaces more for heat to conserve heating oil.

Oil prices jumped by more than $4 a barrel Monday to $90.23 as investors grew more concerned that violent protests spreading in Libya could disrupt crude supplies from the OPEC nation and affect other oil-rich countries in the region.

Other factors driving the increase include a decline in the dollar's value, which has made oil futures, priced in dollars, more attractive to investors with foreign currencies; unexpected refinery outages affecting Northeast gas prices; and cold weather, which is spurring demand for heating oil.

But the key element is rising demand for fuel - especially diesel -- in the developing world, including China, said Andy Lipow, president of Houston consulting company Lipow Oil Associates Llc.

"Prices have been led higher by the worldwide demand for distillate [diesel and heating oil] fuel," which, in turn, has increased demand for crude oil . . . and gasoline prices have been drawn up with it," he said.

Though experts differ over whether and when motorists will see relief at the gas pump, one thing is certain: Higher prices pose greater challenges to car-dependent Long Islanders already struggling to cope with economic pressures.

 Ramon Rodriguez
Restaurant owner

Worry: Gas prices

Rodriguez, the owner of Dominican Restaurant in Freeport, said he feels squeezed by the escalating costs of gasoline. The driver who once charged him $50 to deliver catered food to Brooklyn and Queens churches now charges an additional $20 for gas. Passing rising expenses on to his customers isn't an option, Rodriguez said.

"It's ridiculous. You go to sleep and the price goes up."

In addition to gas, his food costs have been skyrocketing, too. Lemons that were $18 a case went up to $64 a case recently, and a $20 case of lettuce now costs $50, he said.

There isn't much he can do about it at the moment but pay the bill, he said, noting that printing new menus would cost about $1,500.

Javier Clarke
College student

Worry: Gas prices

Clarke, 23, who attends Nassau Community College and wants to be an X-ray technician, has a fuel-efficient 2006 Toyota Corolla. But even so, rising gas prices have meant trimming other items in his budget. The $45 a week he once spent on gas has crept up to $55, he said, prompting the Hempstead resident to buy smaller quantities of staples, cook at home more and seek out items on sale.

Clarke, who works at Sam's Caribbean Marketplace in Hempstead, said he buys about a half gallon of milk a week instead of a gallon. He figures he saves about $25 weekly by eating out less, from four times a week to about two. But should gas hit $4 a gallon, he said it will mean finding another part-time job or adding more work hours to make ends meet.

"If the gas prices go up that high, it's going to do a hurting on the economy," Clarke said. ". . . We're already barely scraping through the recession."
 

Marc Herbst
Business executive

Worry: Fuel costs

Long Island's highway construction industry is among the hardest hit by rising fuel costs, said Marc Herbst, executive director of the Long Island Contractors' Association in Hauppauge.

"The negative impact is compounded at least threefold," Herbst said. "Asphalt, a petroleum-based product, increases in cost; its manufacture at plants requires fuel for heating and the cost to operate the vehicles used for transportation of materials to work sites increases."

Add to that the expenses incurred by state laws requiring nighttime construction for major state roads, he said. The difference between fuel priced at $3 versus $3.50 will increase costs for lighting alone by about $5,000 a week, he said.

"A typical road resurfacing project requires approximately 250 light towers, each consuming eight to ten gallons a night," Herbst said. "That equates to about 2,000 gallons a night, or about 10,000 gallons for a five-night workweek."

The association has sought to have all contracts include escalation costs to adjust for the increasing fuel prices, but most governments are not willing to bear that burden, he said.

"You might not start a job for six months and you're locked in," he said. "The margins are extremely tight in this economic climate and we constantly hear of contractors bidding at cost to keep men and women working."

Finding ways to save gas and money is a difficult task for contractors, Herbst said. The association has been in discussion with various municipalities to try a warm-mix asphalt that consumes less fuel.

Tom and Anne Lavan
Retirees

Worry: Heating oil costs

Retirees Tom and Anne Lavan, both 78, of Farmingdale, said they're cutting back on trips to the movies, watching their grocery dollars more carefully and are trying to combine errands so they can continue making regular trips to the northern suburbs, and to Pennsylvania and Maryland to visit children and grandchildren.

Tom Lavan said the couple drive about 8,000 miles a year - well below the overall national average of 13,000 - and spend on average $25 a week for gas. "So, it's not that bad," he said. But trips to Westchester or Rockland can cost $40 round-trip, plus tolls.

Lavan said soaring heating oil prices, which are at their highest level in two years, are a factor in the couple's decision to sell their home and move into a retirement condo in Rye. "We have a big four-bedroom house," said Tom Lavan, a former high school social studies teacher. Another is that Rye is closer to most of their seven children and 11 grandchildren.

Lavan has his heating oil price capped this year at $3.329 - a bargain this winter. Still, the couple's decision to sell their house was based partly on what it costs to heat it - $329 a month on a budget plan.

Despite the weak real estate market, the couple were lucky on the sale of the house. The Lavans got two bids after six weeks on the market and are now in contract. "We're in an upscale neighborhood, and over the past 40 years we've maintained the house and property well," he said. "All that helped."

Gina Hansley
Teacher aide

Worry: Gas prices

Hansley, of Oceanside, says she's more likely to take the train now to Manhattan rather than drive her Honda Accord to accompany her 20-year-old daughter back to college. And she tries to reduce driving for errands, walking when she can to nearby stores. When she drives, she says, "I try to combine where I'm going to go -- everything right in a row rather than separate trips."

Still, she says, as prices keep rising, it's costing her about $60 every two weeks to fill her tank. So, she says, she's looking for a second job to supplement her income as a teacher aide.

Matthew Metz
Business owner

Worry: Gas prices

Metz buys diesel in bulk to run his 12 trucks and the equipment in his sand mine in Manorville - storing it in a tank on site - so he pays less than regular retail. But he's been hit with the same increase as consumers who buy it at gasoline stations: around 60 cents a gallon or about 20 percent over a year ago.

Metz, who is president of Ranco Sand and Stone, said he's unable to pass the extra costs on to customers because the prices to most of his customers on Long Island and in Westchester are fixed for a year. "I have to absorb it," he said.

Barbara Mehlman
Librarian

Worry: Gas prices

Mehlman, 68, of Great Neck, said that rising gas prices have affected her everyday life, including shopping for clothes. One example: She recently returned a pair of $100 jeans that sat in the store bag for more than two weeks.

"I would keep looking at it and thinking, 'What a waste of $100,' " Mehlman said.

Her children are grown and she pays low rent for an apartment that's been her home for many years. But, having enough cash on hand for unexpected emergencies is important and is affected by how much she spends on gas, she said. Last year, she had surgery, most of which was covered by her insurance. However, she unexpectedly got a $1,600 bill from a pathologist who didn't take her insurance. And in the New York City school system, the threat of layoffs always looms.

Mehlman, who has an 18-mile round-trip commute for work, now fills her tank only halfway. And, though she loves taking driving vacations, high fuel costs may jeopardize some planned excursions, like driving with a friend from California's Napa Valley to Oregon.

"If gas goes up to $4 a gallon, we may rethink that trip," she said.

Rosa Gaudio
Office manager

Worry: Gas prices

The office manager and single mother of two sons has already cut back drastically, she said, running all her errands along the route she drives to work, giving up dining out and going out to movies. She estimates that coordinating her errands this way saves her about $50 a week.

She replaced her Chevy Trailblazer, which was costing her about $600 a month in gas, with a Malibu, and slashed her gas costs to about $380 a month, she said. For more savings, she switched auto insurers.

Gaudio, 42, has to balance household expenses with a $32,000 tuition bill for her oldest, who is a freshman in college. Her other son will head to college in three years.

"The high gas prices are really affecting me," Gaudio said. "I am very concerned because I try to save as much money as I can being a single mom with a child in college."

Sam Clonmell
Graduate student

Worry: Gas prices

The graduate student said his frequent trips to St. John's University in Jamaica, Queens, from Westbury take a chunk out of his budget - about $120 a month.

"Yeah, they affect me," Clonmell, 27, said of rising gasoline prices. "But you do what you [have] to do. . . . "They go up, they go down; it's just inevitable."

As a finance major and full-time assistant bank manager, Clonmell knows how to budget his money. However, trimming back what he pays to fill his four-cylinder Ford's tank isn't on his agenda.

"Time is a huge factor for me. I need to be able to get somewhere and get there quick, rather than rely on mass transportation."

Jim Dreeben
Business owner

Worry: Gas prices

Dreeben, 70, owner of a snowplowing business and the water-sports shop Peconic Paddler in Riverhead, often has a 100-mile commute. His wife is a teacher in Westchester, so he frequently splits his time between Jamesport and his wife's place in Yorktown Heights. For the past several months, he has made the round-trip commute for four days instead of five when business allows. Dreeben estimates that this cuts his monthly commuting tab of $500 down to $400. He also tries not to exceed 60 mph to conserve gas, he said.

But there's not much he can do to save gas when it comes to his snowplowing work. His trucks only get only 5 to 7 miles per gallon. A day of plowing after 8 to 10 inches of snowfall can eat up $40 to $70 in gas for his two trucks, he said.

"Eventually, we are going to live down here full-time and then probably use one-tenth as much gas."

With Keith Herbert