President Carter's new 10-cent-a-gallon "gasoline conservation fee" will help drive prices to over $1.50 a gallon should be adequate in the Washington area, public officials and oil industry spokesmen said yesterday.
"There was a lot of talk about $2 gasoline by the end of the year, but we don't see that happening," said Sunoco spokesman Bud Davis. "It may be $1.50 by summer, but that's as far as we're willing to look."
Though the oil companies are now storing some of the highest inventories of gasoline and crude oil in U.S. history, motorists can expect these price increases -- on top of the area's current average of $1.26 a gallon -- by summer vacation time:
10 cents a gallon imposed by Carter to cut gasoline consumption as part of his anti-inflation program. This fee does not require congressional approval and will be phased in rapidly starting May 15.
5 cents or more a gallon in new local taxes in Northern Virginia: possibly 8 cents or more a gallon in the District if the City Council approves a new tax proposed by the mayor; new gasoline taxes in Maryland have not gone past the discussion stage.
About 4 cents, or 1 cent each month, because of the decontrol of domestic crude oil prices.
1 cent or more in increased dealer margins allowed under federal price controls on gasoline retailers.
An unknown amount because of further world crude oil price increases passed through to consumers by oil companies. The Organization of Petroleum Exporting Countries will meet again in the next few months.
"Supply should be good for the summer," a Gulf spokesman said. "There should be no disruptions. We don't see any repetition of long lines." "
Analysts said that continually rising prices should continue to control the demand of American motorists for gasoline, perhaps even lowering it further.
Americans will use about 7.4 percent less gasoline this month than they did in March a year ago, according to the Lundberg Letter, a leading petroleum marketing publication.
"Unless people begin buying more gasoline than they have recently demonstrated they want at current prices, there could be a surplus of available gasoline in March . . ." a recent Lundberg Letter said. "The surplus should continue indefinitely barring interruption of the world crude oil supply."
A year ago the average price of a gallon of gasoline was 73 cents. Since then it has increased about 50 cents a gallon -- 20 cents of that during the last three months alone in the Washington area.
District of Columbia energy chief Chuck Clinton said yesterday that rising prices are good because they encourage conservation. But he added that he is concerned about their impact on low-income people.
"Fifteen percent of the District's population are [below] the poverty level, and the price increase will hurt them the most -- the ones who can least afford to pay it."
Clinton said that despite the nation's high gasoline stockpiles, "people must continue to conserve -- to cut out discretionary trips and weekend jaunts. m
National gasoline and crude oil stocks are so high now because the oil companies have been "building stocks in the face of an uncertain future," according to Ed Murphy, chief statistician of the American Petroleum Institute.
The companies have been able to do so because of a warm winter that did not require as much heating oil as had been anticipated, because of conservation, and because crude oil has been available on the world market in sufficient quantity.
But the high stocks represent only several days of extra supply for the country, which used 6.6 million barrels of gasoline a day in February. "If there's a fire and a couple of refineries [unexpectedly] shut down, you can kiss that excess goodbye," said Sunoco analyst Joe Strain.
Thus the high gasoline and crude oil inventories have only a limited potential for holding prices down. While the pace of price increases could slow from the furious pace of the last few months, it is unlikely that prices will actually fall, according to the Lundberg Letter.