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Last Updated: Thursday, 6 May, 2004, 12:27 GMT 13:27 UK
US refineries blamed for dearer gas
Filling up a car
US motorists are used to cheap fuel
On average, an American motorist will drive twice as much every year as his European or Japanese counterpart.

The car has always been a more integral part of life in the US, with its wide lanes and open freeways, than in the smaller streets of Paris, London or Tokyo.

That is why petrol (gasoline) prices matter in America. And they could matter enough to cause serious political problems to the powers-that-be in Washington.

As petrol prices at the pumps rise, consumers could decide to vote with their feet.

Every time the price of gas spikes at the pump, we see a big spike in the profits of the gasoline refiners
Jamie Court, consumer rights activist
In California, where prices have jumped by 20% so far this year, the problem has become particularly acute.

Drivers now face the politically sensitive milestone of $2 a gallon as they head into the holiday season.

Profit motive

But according to Jamie Court, President of the Foundation for Taxpayer and Consumer Rights, California's residents shouldn't blame the Opec producers' cartel, which attempts to control oil prices, but rather local US refineries.

"Every time the price of gas spikes at the pump, we see a big spike - about the same size - in the profits of the gasoline refiners," he told the BBC's World Business Report.

"When you look deeply at the problem what you see is that we have a small number of oil companies that refine gasoline in the US, and they have kept very low inventories, they have closed refineries, they have kept the system running almost on empty."

At the same time, the price of crude oil is close to a 13-year high, at almost $40 per barrel, because of continuing volatility in the Middle East.

This doesn't look like coming down any time soon, putting US consumers under severe pressure to curtail their expensive addiction to driving.


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