Talk about being powerless. Isn't that how you feel whenever you drive to a Lexington gas station for a fill up? Like a lamb going off to slaughter. Sure, you can shop around among the competing stations and save a nickel a gallon here or there, but with gas prices soaring to $3.60 a gallon or more, with no end in sight, you probably feel a little nostalgic for the good old days of relatively cheap gas. Well, you might be surprised to know that the days of 99 cents-a-gallon gas in Lexington weren't as long ago you might think. Not the 80s or even the 90s, but more recently.
It was late in 2001. The United States was numb over the September 11 terrorist attacks. Everyone was on edge and worried about the security of our nation. With the attacks being airline-related, business and pleasure travel by air slowed dramatically. Airports were being fitted with never before seen security measures. People simply weren't in the mood to travel as much, or were just plain scared. Who could blame us? Do you remember the first time you flew after September 11? Remember glancing nervously around the cabin once you were airborne? In fact, discretionary travel of all kinds - automobile, RV, bus, train - slumped. The economy was in a funk. But with less gasoline, diesel and jet fuel being consumed, gas prices began a steady drop. The old high school economics lesson about those mysterious forces of supply and demand were playing out right in front of us on a local and national scale.
On 9/11, the average price of gas in Kentucky was $1.55, according to AAA Blue Grass Kentucky's Daily Fuel Gauge Report. In those days, Kentucky's gas prices were consistently ranked as the 7th or 8th cheapest among the 50 states. Today, due to higher gas taxes and other factors, Kentucky's prices rank only about the 30th cheapest in the country with New Jersey currently having the lowest average price and California the highest.
On the very day of the attacks, a notorious few Lexington gas station operators jacked up their regular grade prices to an unheard-of $1.99 per gallon. It alarmed already jittery drivers. Lines began to form at some lower-priced stations as panicked drivers feared the city might run out of gas at any moment or that the price could soar to an unfathomable $3.00 a gallon (little did they know).
Though many didn't know it, there was no gas shortage. Supplies around the city, state, and nation were in fine shape. The U.S. Strategic Petroleum Reserve, the nation's emergency oil stockpile, also the largest in the world, was sufficient. But some Lexington gas station operators, later accused of being unpatriotic, had taken advantage of the day's horrible events to grab a quick profit. To their credit, the vast majority of station operators kept their prices steady. Within 24 hours, the profiteers quickly got back in line with the others, and prices hovered around the $1.50 mark. But then, prices began to drop - a lot.
From a citywide average price of $1.55 on September 11, 2001, Lexington's price dropped 25 cents in October, another 16 cents in November and finally 13 cents in December, down to the lowest price we've seen since - $1.01 a gallon, AAA reported at the time. Being an average price, many stations in town were selling in the upper 90-cent range. You could fill your tank without going broke.
The rollercoaster price ride ended in January 2002 when the city's average price climbed nine cents. By April, people were traveling more and businesses began their post-9/11 comeback. Gas was back up to $1.29 or more. Oh well, it was nice while it lasted.
Will we ever see 99-cent gas again in Lexington? Seems impossible now, but you never know. Certainly, no one wants another national catastrophe to nudge consumers into driving less, thus increasing gas supplies and in turn lowering prices. But it just demonstrates how, collectively, everyone in Lexington, Central Kentucky and the nation play a starring role in gasoline supply and demand, and ultimately how much we pay at the pump.