WXXI Local Stories
8:42 am
Tue November 18, 2008

Gas Prices Relatively Higher in WNY

Rochester, NY – Gas prices in Western New York are not dropping as quickly as prices across the rest of the state, and across the nation. That's according to AAA, which says that Buffalo now boasts the highest gas prices in the continental US at $2.55 a gallon. Buffalo beats out New York City and Flagstaff, Arizona for most expensive gas. In fourth place, with gas at $2.46 a gallon, is Rochester.

Shaun Seufert is with AAA, which has been trying to get to the bottom of the high prices. He says there are lots of theories as to why prices are dropping elsewhere but not here - but not a lot of evidence to support them.

"One example is that gasoline has to travel further down the pipeline to reach wholesale and retail stations here. Well, gas has always had to travel further down the pipeline. Also the tax structure - the tax structure hasn't changed in the past few months, so we can't attribute higher taxes in the state to higher gasoline prices."

There's a spread of about 26 cents between the highest price in New York, in Buffalo, and the lowest price in the state, in Syracuse. But a year ago, that spread between high and low prices was only 7 cents, according to AAA.

Paul Marone is the owner of East Ave Auto, a Sunoco gas station and repair shop. He says prices are high because fluctuating prices from distributors make it difficult for small gas stations to compete.

"In the thirty years that I've been here, I've never seen the price drop 20 cents in one day, which just recently happened ... I've seen it go up 5 and 15 cents, especially when one of the hurricanes comes, but I've never seen it drop down that quickly. It's a marketing nightmare because we can't catch the price as it [goes] down."

Marone says big gas stations can afford to drop their prices when the market rate goes down, even if they paid more for the gas that's in their tanks. He says smaller stations have to sell the gas at the rate that they bought it before they can buy more cheaply, and sell that at a new, lower price.

But Marone also blames zone pricing for expensive gas in Western New York. That's the practice of charging more in some areas over others. Advocates say that zone pricing is the marketplace doing its job; critics call it price fixing. Either way, legislation signed into law by Governor David Paterson will make zone pricing a illegal on November 24.

The disparity in prices across New York has caught the attention of federal authorities. Buffalo area congressman Brian Higgins has asked the Federal Trade Commission (FTC) to look into why prices aren't dropping locally. The FTC told Higgins that prices are "out of bounds" with where they ought to be, and have begun an inquiry.

Click the blue markers below to compare gas prices, as of Tuesday morning, across New York state.

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