Columnist Susan Snyder: Figuring out prices a real gas

Friday, April 4, 2003 | 5:24 a.m.

Those ridiculous prices at the gas pump are figments of our imaginations.

Or at least, any perceptions we have about them being the result of price-gouging are more imagined than real.

According to a statement summarizing a teleconference Nevada Attorney General Brian Sandoval had with other state attorneys general Wednesday, Nevada investigators probed the petroleum industry and found no evidence of gouging.

"The petroleum market is multinational and incredibly complex, so any examination of it necessitates leverage," Sandoval said in the statement. "Collaboration gets us just that: More eyes and ears on the task. There is a tiny minority out there that claims we're up against a brick wall, but brick walls, too, can have ears, and the more the better."

OK, I have no idea what any of that means. Was hoping you would. I never have seen a brick wall with ears. But then, Southern Nevada builders don't seem to offer many variations in wall design. Must be different up North.

Anyway, Sandoval's statement says investigators culled responses from the petroleum industry to find reasons why we're paying more for a gallon of gasoline than a cup of Starbucks.

Knowing full well that petroleum industry representatives would never ever fib, here's what investigators uncovered:

Prices have skyrocketed because of an oil industry strike in Venezuela, cold weather on the East Coast that raised the demand for heating oil, uncertainty due to the war in Iraq, tight supplies "due to winter-to-summer formulation transitions" (again, your guess is as good as mine), and the fact that Larry the Texas Oil Baron's daughter needs braces or he'll never get her married off and be forced to set her up with a trust fund.

OK, I made up that last one.

The attorney general's office says Nevada's requirement for "boutique" gas formulas is another reason for the hike.

Hey, we build a $95 million theater so people can watch a middle-age waif's 90-minute music video. Of course we need "boutique" gas.

Seriously, "boutique" is the term applied to gasoline formulated to have specific reactions, such as burning cleaner or vaporizing more slowly in hot, dry climates.

For details on how gas prices are figured, the attorney general's office suggests logging onto howstuffworks.com. The gas prices page opens with a section titled, "Where Your Money Goes."

(Flush.)

It says 37 percent of the retail price goes to crude oil suppliers, 27 percent covers taxes, 20 percent pays for refining and 10 percent pays for distribution and marketing.

The remaining 6 percent plunges into a giant black hole.

However you figure it, Nevada's prices are enough to give the average driver ... nah. Too obvious.

Suffice to say we're paying a lot more than residents in every other state except Hawaii and California. According to AAA, we're paying $2.05 for a gallon of regular, on average. Hawaiians are paying $2.27, while Californians are forking over $2.15.

And for the time being it seems gas prices in the $1.45-per-gallon range we saw a year ago will remain as rare as ears on a brick wall.