Over A Barrel

For consumers who lived through the long gasoline lines and lowered thermostats of the 1970s, this winter has brought back chilling memories. Symptoms of an energy squeeze are breaking out all over. Several airlines have abruptly added a surcharge to their fares to help cover spiraling jet-fuel costs. Trucking companies have begun to pass along the rising cost of diesel oil, which in just one month shot up 30%, to $1.35 per gal. Motorists may soon be affected too: a sharp decline in gasoline inventories is likely to boost prices at the pump by spring.

No one has felt the pinch more keenly than heating-oil customers. During the brutal cold snap last month, when temperatures hovered in the single digits even in parts of the Sunbelt, fuel oil was in such demand that some distributors ran dry. The clamor for supply pushed prices up as high as $1.50 per gal., a 50% increase in one month.

The steep run-up has prompted Congressmen and consumer advocates to accuse oil companies of taking advantage of the deep freeze to gouge their customers. Citizen Action, a consumer group, says the profits that refiners were making on residential heating oil in the Northeast jumped at least 150% in the past three months; in New Jersey the increase was 314%. Last week the Energy Department said it was launching a study to determine whether oil companies colluded to raise prices.

While the energy squeeze is far less severe than the shocks of the '70s, the days of cheap and superabundant oil are probably gone. A barrel of crude now costs about $23, up from $17 a year ago, largely because of growing consumption. Rising energy prices were the main reason that the Government's index of wholesale prices increased 4.8% during 1989, the steepest rate since 1981. The forecast for this winter: even if temperatures stay at relatively comfortable levels, relief from higher fuel costs is unlikely.