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As oil prices rose to around $96 a barrel Wednesday — a two-year high — amid fears that a continued violent power struggle in Libya could disrupt supplies, motorists are feeling the pinch here at the pump even as drilling activity was ramping up in local onshore plays.

According to AAA’s Daily Fuel Gauge Report, the current average price statewide for a gallon of regular gasoline was $3.05, up from $3.03 yesterday, and also up from $3.00 a week ago.

A month ago regular was going for $2.99 a gallon on average, and a year ago it was priced at $2.56.

AAA’s report also showed that drivers in Lafayette were feeling a little lighter in the wallet than those in other cities across Louisiana. While regular was selling for $3.07 a gallon here, or a couple pennies more than the state average, drivers in New Orleans were spending about a nickel less.

The price of gasoline at the Chevron station on the corner of Bertrand Drive and Congress Street reflected the average for Lafayette, but that was no consolation to Richard Cassidy.

“It is terrible. My whole check is going for gas,” said Cassidy, who drives to Lafayette from his home in Erath daily in his SUV to go to work. “It is costing me about $20 a day. I sure hope it comes down soon.”

James Aucoin, who said he drives his car 60 miles each day to get back and forth to work, shared that view.

“I used to be able to fill up my tank for $15, now it is $35. That is way too high. It is really hard,” Aucoin said.

Despite the fact that his car gets close to 30 miles a gallon, Sonny LeBlanc said the higher price of gasoline is causing him to avoid any unnecessary trips.

“Every time it goes up, I drive a little less,” LeBlanc said.

Holding a slightly different view was Erin Blanchard, who is a land contractor for an oil company. “This is what is paying my bills,” Blanchard said.

Still, she said the rapidly rising prices are hurting. She is compensated by her company at the mileage rate set by the Internal Revenue Service, which is currently 51 cents a mile.

As oil prices rose to around $96 a barrel Wednesday — a two-year high — amid fears that a continued violent power struggle in Libya could disrupt supplies, motorists are feeling the pinch here at the pump even as drilling activity was ramping up in local onshore plays.

According to AAA’s Daily Fuel Gauge Report, the current average price statewide for a gallon of regular gasoline was $3.05, up from $3.03 yesterday, and also up from $3.00 a week ago.

A month ago regular was going for $2.99 a gallon on average, and a year ago it was priced at $2.56.

AAA’s report also showed that drivers in Lafayette were feeling a little lighter in the wallet than those in other cities across Louisiana. While regular was selling for $3.07 a gallon here, or a couple pennies more than the state average, drivers in New Orleans were spending about a nickel less.

The price of gasoline at the Chevron station on the corner of Bertrand Drive and Congress Street reflected the average for Lafayette, but that was no consolation to Richard Cassidy.

“It is terrible. My whole check is going for gas,” said Cassidy, who drives to Lafayette from his home in Erath daily in his SUV to go to work. “It is costing me about $20 a day. I sure hope it comes down soon.”

James Aucoin, who said he drives his car 60 miles each day to get back and forth to work, shared that view.

“I used to be able to fill up my tank for $15, now it is $35. That is way too high. It is really hard,” Aucoin said.

Despite the fact that his car gets close to 30 miles a gallon, Sonny LeBlanc said the higher price of gasoline is causing him to avoid any unnecessary trips.

“Every time it goes up, I drive a little less,” LeBlanc said.

Holding a slightly different view was Erin Blanchard, who is a land contractor for an oil company. “This is what is paying my bills,” Blanchard said.

Still, she said the rapidly rising prices are hurting. She is compensated by her company at the mileage rate set by the Internal Revenue Service, which is currently 51 cents a mile.

“That is enough to pay for my gas, but it isn’t enough for oil, tires and all the rest,” Blanchard said. “They need to raise that rate.”

Planning ahead helps company’s bottom line

Richard Zuschlag, chairman of the board and founder of Acadian Cos., has a fleet of 360 ambulances in Lafayette, 300 of which are in regular use. He said higher gasoline prices will hurt the company’s bottom line, but not as much as they did in 2008.

“In 2008 we had a $7 million budget for fuel and we went over budget by $2 million that year,” Zuschlag said. “It crippled us.”

The company found that it couldn’t add a surcharge for its fuel rate. But on the advice of Bill Vidacovich, Acadian’s vice president of vehicle management, the company made a decision to hedge 75 percent of what it pays its supplier for fuel.

“So if the price goes below $2.75 a gallon we pay a hedge, but if it goes over $3.50 a gallon, they pay us,” he said. Acquiring 100 smaller, more fuel-efficient ambulances have also lowered costs, he added.

Increased oil prices will spur more onshore drilling in Louisiana and Texas predicted Don Briggs, president of the Louisiana Oil & Gas Association.

“We’re already starting to see more activity in onshore oil plays,” he said. “But we in this industry have to fill our cars up and buy groceries, and we don’t want to see oil and gas prices that are extravagant. It’s not good for the national economy and that’s not good for the local economy.”

If the chaos in Libya spreads to other bigger energy producers in the region, such as Iran or Saudi Arabia, price fluctuations could become as sharp as those in the 1970s, when an OPEC embargo caused gasoline shortages in the U.S., analysts warned.

Briggs said that reopening drilling in the Gulf of Mexico, which has been at a near standstill in the aftermath of the BP blowout in April 2010, would go a long way toward creating what he calls “energy security” for the United States. “I don’t know of anybody in their wildest imagination saying they feel secure about energy prices knowing that the Middle East is as volatile as it is.”

Original Article