Oil, fuel prices plummet in wake of attacks Local prices reflect national trend

January 18, 1991|By Kim Clark

An article in yesterday's edition of The Sun incompletely described Crown Central Petroleum Corp.'s price cut policy.

William Snyder, a vice president of the company, said yesterday that while wholesalers on the rest of the East Coast saw 10-cent-a-gallon price decreases in gasoline as of midnight Thursday, Maryland Crown dealers will see less of a cut.

Mr. Snyder said because Crown provides services to station managers in Maryland that it does not provide to stations in other states, Crown will lower its prices here between 4 and 5 cents.

FOR THE RECORD - CORRECTION

A week of war fears, oil-price increases and hoarding has ended with the outbreak of fighting and tumbling petroleum prices.

Local gasoline station managers and fuel-oil dealers said yesterday that prices and demand fluctuated wildly from day to day and company to company before the Jan. 15 deadline for an Iraqi withdrawal from Kuwait, as many customers topped off their tanks in the last days of peace.

But now that the war in the oil-rich Middle East has started, big and little oil and gasoline companies are slashing their prices.

Speedy Oil Co. in Baltimore, for example, raised its price 2 cents to 5 cents every day this week because of rising spot-market prices and heavy demand before the war, said co-owner Jean Smith.

"By late Monday, we couldn't take any more calls for Tuesday fill-up," she said.

But business died off after fighting began, and Speedy's price peaked at $1.27 a gallon, Mrs. Smith said. She said she expects the company to drop its price today after yesterday's $10 drop in oil prices on the spot market, the biggest decline ever.

William Snyder, Crown Central Petroleum Corp. vice president, said yesterday that his company would cut its wholesale prices on the East Coast by the equivalent of 10 cents a gallon for gasoline and 15 cents a gallon for heating oil at midnight last night.

Mr. Snyder said the Baltimore-based oil company would ask its dealers to pass along the price cuts as soon as possible. He said customers are likely to see reductions in pump prices within a week.

Crown was not willing to join several other oil companies that promised not to raise prices for a week, but Mr. Snyder said yesterday's plunge in spot-market prices indicated that the cap was not necessary.

Exxon Corp. also cut its pump prices after fighting started, lowering gasoline by 5 cents a gallon yesterday afternoon, said Kelly Dugan, manager of a station on York Road.

"We were abnormally busy on the 14th. People were topping off" their tanks, he said, then things quieted down as people waited to see what would happen in the Persian Gulf.

But business picked up yesterday afternoon as soon as Mr. Dugan lowered his price for unleaded gasoline to $1.17 a gallon, he said.

He said he attracted customers by decorating his station with flags and yellow ribbons to honor his brother, a Navy pilot serving in the gulf but that "people were coming in and saying they appreciated the price."

Oil analyst Ken Beer, who follows the industry for Legg Mason Wood Walker Inc., predicted that other oil companies will follow Crown and Exxon and that gasoline prices will stabilize after dropping several cents.

Oil, which was trading at $30 to $40 a barrel before the war, "is going to settle down into low 20s and high teens," Mr. Beer predicted.

"The uncertainty [about the effect of war] was a lot worse than reality," he said.

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