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posted: 4/30/2012 5:30 AM

Won't someone promise gas price relief?

Experts: It's likely, but it's anyone's guess

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  • Prices at this Elk Grove Village Mobil station reflect high gas costs across the region. Experts say that because they're so tied to geopolitical events, there's no way of knowing which direction gas prices will head in the future.

       Prices at this Elk Grove Village Mobil station reflect high gas costs across the region. Experts say that because they're so tied to geopolitical events, there's no way of knowing which direction gas prices will head in the future.
    Bob Chwedyk | Staff Photographer

  • Video: MItt's dog on car roof OK?

 
 

Am I crazy to think of buying a small SUV with gas prices over $4 a gallon? Does the 2000 Honda Civic hatchback have a few more years in it? Can we shoehorn suitcases, barking dog and toddler into the 2007 Corolla for the annual summer vacation odyssey? Was Mitt Romney so wrong for sticking his Irish setter Seamus on the roof of the station wagon for a family trip?*

These are the questions I ponder. And that's why this week's column is all about gasoline.

"Will gas prices go up or down?" I asked expert Don Fullerton, a University of Illinois Urbana-Champaign finance and Institute of Government and Public Affairs professor.

"Yes," Fullerton answered, and he wasn't fueling around.

The problem with predicting gas prices, Fullerton said, is that all it takes is a geopolitical event to send rates through the roof. "These things bounce around," he added.

So the nuclear weapons controversy in Iran, a possible coup in Nigeria, Venezuelan President Hugo Chavez's battle with cancer, conflict in the Middle East -- all these issues in oil-producing nations can cause pain at the pump. And don't forget growing fuel consumption in nations like China and India contributing to the supply and demand equation.

"Some of these changes are positive, some are negative ... there's no way to predict these events, they're random," Fullerton said.

But the United States gets much of its oil from our politically stable friends to the north in Canada -- shouldn't a foreign crisis mean we could buy our oil cheaply there?

Canadians aren't stupid, Fullerton said. "If there's another war in the Middle East (for example), then Canadians will make money selling oil at a higher price."

Now I'm getting desperate. Couldn't you just promise that gas will drop down to $3.50 for a gallon of regular this summer? I asked.

"If I told you 'yes' -- it will go down to $3.50 -- I'd be wrong, or it would be inside information that you're not supposed to trade on. The current price of oil already incorporates the best information available," Fullerton said.

If you don't get the answer you want from one source, a good reporter will try another. We call that being thorough.

So I turned to another expert, Don Hillebrand, mechanical engineering Ph.D., former Chrysler executive and director of Argonne National Lab's Center for Transportation Research.

"It's anybody's guess," Hillebrand said. "It's like guessing Powerball."

However, there is some positive news, he added.

"Oil inventories are growing at a fairly steady clip," Hillebrand said, citing discoveries in Brazil and off the Nigerian coast. And new reserves of domestic oil have emerged in places such as North Dakota through fracking -- the process of drilling, then injecting chemicals, sand and water into rock at high pressure. "It's added to the total inventory in a fairly dramatic way."

Add to that, America's fleet of cars is using less gas as the industry adapts to tougher federal laws requiring an average of 35 mpg for cars as of model year 2016.

With all this going on, "you'd think the price of gas would drop," but there's only been a 10-cent or so dip recently. "It's strangely high considering the excess capacity," Hillebrand said.

Some of the market volatility comes, again, from international occurrences, such as the Obama administration's move to put tougher sanctions on Iran. That involve U.S. allies cutting back on oil imports from that country. Then, there's conflict affecting production in the Sudan region -- another major exporter.

So, no answer on the gas price thing?

"There are geopolitical counterbalances," Hillebrand said. "In the long term, prices should drop -- they almost have to unless there's some huge political problem."

And in the short term to find relief, "drive out of Chicago," he advised.

What do you think? Are SUVs obsolete? Got any gas-saving tips? Drop me a line at mpyke@dailyherald.com.

*(Note to dog lovers: Our pet will remain in the car if it kills us.)

One more thing

The cost of a gallon of regular gas in the Chicago region Friday was $4.20, according to the AAA. Sad to say, that's a lot better than a month ago when we were paying $4.51 a gallon. A year ago, a gallon of regular came in at $4.30, AAA noted.

And to Hillebrand's point, if you cross the border to Indiana, the state average is $3.82 a gallon.

Find fuel prices by checking out the AAA website http://fuelgaugereport.aaa.com.

You should know

The U.S. Department of Energy has advice on scrounging gas.

• Don't drive like an idiot. Sounds obvious, but speeding, sudden braking and rapid acceleration will lower your mileage between 5 percent in town and 30 percent on the highway.

• Keep to the speed limit -- every 5 mph over 60 mph equals another 31 cents per gallon of gas.

• Time to clean out the trunk. Removing 50 pounds of whatever junk you might be storing in the car can improve fuel economy by 1 percent.

• Turn the engine off when you're waiting at the drive-through window. Idling uses from 25 percent to 50 percent of a gallon of gas per hour.

Your voice

Geneva reader John Kaindl has a pragmatic take on plans to extend the Elgin-O'Hare Expressway and build a western bypass around O'Hare International Airport.

"In order to make the (project) viable and logical, the access to O'Hare must be included," he wrote. "There should be a parking structure and transportation to the existing terminals available, similar to the existing improvement at the east end of the Airport Transit System (or people-mover). This parking structure should be complete with 'Kiss 'N Ride' availability. The ATS should be extended from the existing United Airlines terminal, west to the proposed parking structure.

"This improvement should be made part of the current improvements at the airport, and would make a western terminal unnecessary. A major portion of the cost should be borne by the current program and the airlines."

Gridlock alert

It's Hanover Park's turn to suffer this week. IDOT crews will work the intersection of Irving Park Road (Route 19) and Barrington Road through July 15. The project involves adding a westbound turn lane and resurfacing. Traffic will be down to one lane in each direction. Courage.

Upcoming

If you take the train into Chicago regularly, you might want to swing by an open house on the Central Loop Bus Rapid Transit project Wednesday. The bus would connect to destinations including Union Station, the Ogilvie Transportation Center, the Loop, Streeterville and Navy Pier.

The event runs from 5 to 7:30 p.m. at the Chicago Architecture Foundation, 224 S. Michigan Ave. RSVP to Nick Nottoli at nnottoli@grisko.com.

Poetry slam

Eileen Valek of Roselle was kind enough to share her transportation ode "Computer on Wheels" so I can share it with you.

"My car is just loaded with new innovations,

It's exciting, but I'm filled with many frustrations.

If I'm lost, I'll need OnStar, but which button to press,

By the time I find out, I'll make a big mess.

Bluetooth is hooked up to answer my phone,

No privacy here when I'm not alone.

People are texting but what can I do,

As I try to juggle a burger or two.

My eyes on the road, that's where they should be,

Computerized cars are not for me!"

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