10-cent gas price hike

Mobil Oil Mariana Islands increased its pump prices by 10 cents a gallon at 3pm yesterday, catching Saipan motorists by surprise especially because it’s only been less than two months since oil giants cut their prices by 5 cents a gallon.

As of early last night, Shell Marianas had yet to adjust its prices. Both companies typically mirror each other’s price changes.

Mobil’s regular unleaded gasoline on Saipan is now $4.809 a gallon, following the 10-cent price hike.

Its super unleaded gasoline now costs $5.129 a gallon, higher than the CNMI’s minimum wage of $5.05 an hour.

Diesel, meanwhile, is now $5.319 a gallon.

Saipan, along with Rota and Tinian, has among the highest gas pump prices in the United States and its territories.

Crude oil soared to its highest price in several months, at over $103 a barrel. Analysts have predicted that gas prices will continue to climb because of a combination of factors that include seasonal demand, rising tensions with Iran, and China’s increasing demand for oil.

Iran, for example, threatened in late December to block the Strait of Hormuz if sanctions were imposed on its oil exports, CNN reports. France, Britain, and Germany have all proposed such sanctions to punish Iran for its nuclear program. The Strait of Hormuz is a critical shipping lane through which 17 million barrels of oil passed per day in 2011, according to the U.S. Energy Information Agency.

Leila Phyllis, 26, said the 10-cent gas price increase would really hurt her household, especially because she just gave birth and is only working part-time.

“I was happy that the prices went down by 5 cents months ago but now it’s up by 10 cents,” Phyllis said as she was buying $25 worth of gas at the Mobil Garapan station yesterday. She said she will try to make her $25 gas last for a few days, and has been car-pooling with a female friend.

Tala Tala Jr., 47, said the $60 gas he pumped into his truck would only last three days, especially now that gas prices went up again.

The Kagman resident said they will further cut expenses, including not eating out as often as they used to, limiting their grocery shopping-“instead of buying steak, we’ll only buy Spam”-and limiting the use of air-conditioner to save on power and use that savings instead to buy gas.

Frank Muña, 28, an employee at the Commonwealth Utilities Corp., was also surprised at the price change, saying it would mean “less money for food whose prices might also go up.”

“I will cut down on habits. For example I’d rather buy food than alcohol. That price increase is disappointing in a lot of ways,” the San Antonio resident added.

A retired government employee said she’s “gotten used to this.”

“It affects us but what can we do?” while filling up her car with $50 worth of gas.

Brett Halstead, an employee at Wondersea Scuba Diving and Diving Boat Charters, said businesses will be financially hit again by this increase.

The last gas price change on Saipan was on Nov. 3, when prices went down by 5 cents a gallon. Prior to that, in July 2011, prices went up by 10 cents.

Retail pump prices are affected by a combination of factors, which include internationally traded wholesale prices, operating and capital cost, distribution costs, taxes and duties, currency exchange rates, and market competition.

Mobil and Shell do not issue advance notice of price changes, so motorists only learn about it either when they gas up or pass by service stations.