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Gas price cheapest in state

The price of gasoline in Southern Oregon may be high, but prices hereare about the cheapest in the state, according to a gas price survey releasedthis week.

Prices at pumps throughout Oregon have risen about 9 cents since July4, according to a recent American Automobile Association survey.

Southern Oregon gas prices hover on average at about $1.40 per gallon,said Charlie Lloyd, spokesman for AAA Oregon/Idaho.

Gas costs about a penny more per gallon in Portland, and several centsmore per gallon in Eastern Oregon and along the coast.

You can gripe about Oregon's prices compared with those in the rest ofthe nation, though.

Oregon offers the third priciest gas in America, behind Connecticut andHawaii, said Mike Morrissey, spokesman for the AAA's national office.

He attributed that to the state gas tax, the cost of living and California'sinfluence.

But gas prices are rising in every state, he said.

Wholesale gas demand exceeded expectations in early August by about halfa million barrels, Lloyd said. That dropped supply 6 million barrels lowerthan it was a year ago.

Maintenance shutdowns ­ especially in California and Canada ­worsened the problem in the West.

This area has a supply problem, said Gary Mallicoat of RogueValley Oil in Medford. The demand this summer is a lot higher thanexpected, and (prices) are still going up every day.

Local service stations have enough gas to serve the demand, even if supplyis down. That demand hasn't dropped as prices have increased.

People have to have gas, said Marilyn Modou, assistant managerat the Exxon station on Barnett Road in Medford. And basically, thestations are all the same.

Local demand is expected to peak for the summer this Labor Day weekend.Prices should level or drop after that as kids go back to school and peopledrive less.

Prices in some parts of California have already leveled off, said MikeHawkins, owner of Hawk Oil in Medford.

But gas prices will probably ratchet up a notch just before Labor Dayweekend, said Don Cannon, manager of the Biddle Road Chevron.

It's that time, he said. They usually get one more(price hike) before the kids go back to school.