Soaring Gas Prices Imperil Summer Tourism

By Richard Martin, 5-07-07

As gas prices rocket past $3 a gallon, many tourism-based businesses in the Rocky Mountain West are bracing for a tough summer – while the nation’s refineries enjoy record profit margins.

A refinery fire in Texas last month has set off a chain reaction across the nation’s supply lines, keeping gas supplies tight, and prices rising, even as the price of crude oil has remained relatively stable. Crude oil prices closed on Friday at $61.93 a barrel – high by historic standards but up only about 1.4 percent on the year. Average margins at oil refineries, by contrast, have risen by 57 percent in the last month alone, reaching $31.22 a barrel last week – the second-highest margin in U.S. history according to the New York Mercantile Exchange. If gas prices head toward $3.50 or even $4 a gallon this summer, it could severely limit Americans’ traditional driving vacations – many of which bring them to the Rockies.

The good news: pointing to increases in crude-oil inventories over the last few months, a report from Phoenix-based Energy Directions Inc. last week concluded that “the conditions are in place for a meaningful decline” in prices at the pump.

In other business news:

-- Surely one of the best local business columnists in the country, the Post’s Al Lewis hit another triple on Sunday by tracking down convicted felon Michael Wise, former chairman of Denver’s failed Silverado Banking, who is now, remarkably, working for a mortgage lender in Florida. Acquitted on bank-fraud charges after the collapse of Silverado in the savings-and-loan crash of the 1980s, Wise went into the real-estate lending business and later pled guilty to wire fraud charges. Now out of prison, found a benefactor in philanthropist and tycoon Chris Likens, owner of Nations Holding Co., the parent company of CFIC Mortgage in St. Petersburg.

-- Recovering from the telecom crash to post its first real profit since the merger of U.S. West and Qwest, Qwest posted $593 million in net income for 2006 and now ranks as Colorado’s largest and most successful public company, according to the Rocky Mountain News. The Rocky published its Colorado 50 rankings for 2007 over the weekend. Buoyed by its meteoric stock rise, Boulder-based Crocs hit No. 19 on the list.

-- The damp and chilly spring has put a cramp in local enjoyment of the outdoors – Gold Hill got 6 inches of snow on Friday – but it hasn’t dampened home sales in the Denver-Boulder metro area. Defying the nationwide housing slump, the average price of a single-family home sold last month rose 11.6 percent over April of 2006, according to data from independent broker Gary Bauer and from Coldwell Banker Residential. County assessors also haven’t gotten the memo about falling real-estate values: recent assessments show home values in Boulder County rising about 11 percent.