Jan. 3, 2003 – St. Croix residents on Friday saw prices at gas pumps go up thanks to an increase in wholesale fuel prices by Hovensa.
A gas station official, who did not want to be identified, said prices across the island are now around $1.29 a gallon for regular gasoline and $1.39 a gallon for premium, while diesel prices vary widely. He said prices went up about 10 cents a gallon island wide as a result of the Hovensa increase.
The refinery raised its wholesale prices by 5.5 cents a gallon to 85.5 cents for regular, by 6 cents a gallon to 89 cents for premium, and by 10 cents per gallon to 84 cents for diesel.
The increases affect only St. Croix service stations because the island's fuel retailers buy directly from Hovensa. Gas at service stations on St. Thomas and St. John comes from wholesalers such as Esso, Texaco and Domino. In fact, St. Thomas and St. John residents would be happy to see prices like those now in effect on St. Croix.
Robert O'Connor Jr., who owns the Texaco station in Cruz Bay, said on Friday that Texaco raised its wholesale price by 3 cents a gallon about a week ago. This translated to a 3-cent increase at the pump for motorists, he said.
Gas is now selling at O'Connor's full-service-only station for $2.06 a gallon for regular and $2.12 a gallon for premium.
Gas pump prices vary on St. Thomas because customers have a choice of self-service, which is slightly cheaper, or full-service a station attendant pumping the gas. But in general they run about 6 cents a gallon less than on St. John, O'Connor said.
Because local government offices were closed on Friday for the Crucian Festival holiday, no one could be reached at the Licensing and Consumer Affairs Department for an update on gas prices.
Even with the new increases, St. Croix residents are getting a better deal than many mainland motorists. According to the American Automobile Association, known informally as AAA, the average prices for gas across the nation on Thursday was $1.46 a gallon for regular, $1.60 a gallon for premium and $1.53 a gallon for diesel.
Hovensa spokesman Alex Moorhead said on Friday that prices are up both because of concerns about the looming war between the United States and oil-rich Iraq and because of the month-long strike in Venezuela that has shut off the supply of crude oil from that country.
"It continues to be a difficult situation because of speculation in the market," Moorhead, Hovensa's vice president for government affairs and community relations, said. He declined to say where Hovensa is getting its crude oil now.
He said that before the general strike that has paralyzed Venezuela and shut down crude oil production, the South American country supplied 60 percent of Hovensa's crude oil and all of its heavy crude.
Hovensa is a joint venture of Amerada Hess, which owns Hess Oil Virgin Islands Corp., and Venezuela's huge state-owned oil company, Petroleos de Venezuela. The company was created three years ago to facilitate the process of obtaining $600 million in financing to build the huge coker unit that opened at the refinery last summer, allowing Hovensa to process heavier, and thus less expensive, crude oil, most of which has come from the South American nation.
Moorhead said Hovensa is continuing to operate on the reduced production schedule that was instituted on Dec. 12, about a week after the start of the strike in Venezuela. He declined to say how much the company has cut back.
He said Hovensa's last increases in wholesale prices to customers on St. Croix occurred on Aug. 20, 2002, for gasoline and on April 3, 2002, for diesel fuel.
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