AAFES keeping Japan, Okinawa gas prices at pre-Katrina levels, for now
Stars and Stripes October 1, 2005
AAFES for the month of October is insulating Pacific motorists from the brunt of stateside fuel prices that skyrocketed to over $3.10 a gallon in the aftermath of hurricanes Katrina and Rita.
Gas prices at Army and Air Force Exchange Service pumps in South Korea, however, will go up 8 cents on Saturday and Guam’s will rise 12 cents.
In Japan and Okinawa, with the help of discretionary funds provided by the Japanese government, the price at the pump will hold at its current $2.03 a gallon for now.
AAFES’ unleaded gas in South Korea goes from $2.517 to $2.597 a gallon, while drivers on Guam will pay $2.669 for an unleaded gallon — up from September’s $2.549.
In adjusting prices monthly for South Korea and Guam, AAFES typically takes the previous four-week Department of Energy average and tacks on local dispensing costs. But because stateside pump prices reached an all-time high — the national average jumped from $2.653 to $3.117 — in the week after Katrina struck the Gulf Coast on Aug. 29, AAFES opted to base overseas October prices on pre-Katrina DOE averages, company officials said in a news release.
For its September fuel prices, AAFES used the DOE averages for the weeks of Aug. 1-22, or $2.497 a gallon. If the October price had been calculated using the four-week DOE average from Aug. 29-Sept. 19 — $2.90 — the price could have jumped more than 40 cents a gallon.
One exception to AAFES’ overseas pricing policy occurs in Japan and Okinawa, where midgrade gas has remained at $2.03 a gallon since June and DOE averages currently are not being used to calculate retail prices.
“Using special discretionary funds available only in Japan and Okinawa, we have held the gas at the June price,” said Sgt. 1st Class Amanda Glenn, AAFES Pacific spokeswoman. Those funds, said AAFES Pacific spokesman Master Sgt. Donovan Potter, come from the government of Japan, allowing AAFES to give its customers in mainland Japan and Okinawa a price break on fuel.
But, they said, the current price will be re-evaluated in October once AAFES receives its new buy price for wholesale gas from its Japanese supplier. AAFES buys gasoline for mainland Japan and Okinawa from the Defense Energy Support Center at Yokota Air Base near Tokyo. The contract is typically adjusted each fiscal year, though AAFES officials noted that its wholesale costs rose from $1.38 to $1.79 a gallon in an unusual move this spring. The U.S. government fiscal year begins Oct. 1 of each calendar year.
“In recent history, our supplier has not done a midyear price increase but due to the astronomical costs (of fuel), they just had to,” Potter said.
As of Thursday, AAFES had not received its new contract for fiscal 2006, Potter said, though one was expected before Saturday.
Retail price for gas in mainland Japan and Okinawa could change as a result, he said. If the price “increases for what we pay, it’s expected it will increase at the pumps,” he said.
AAFES officials said they could not speak to what would happen to AAFES prices in November if stateside prices hold steady or continue to climb.
“Although preliminary reports indicate that Hurricane Rita did not pack the same punch as Katrina, the aftershocks could be enough to keep pump prices high for a while as long as supply is low and demand outpaces productions,” AAFES officials were quoted as saying in a news release.
This week’s U.S. price average for unleaded gas was $2.81 a gallon.
“The (AAFES) board of directors will meet in November and we expect that there will be talk of the fuel pricing policy” then, Potter said. “They may change the way they do business; they may not. We expect they’ll address this issue for the entire Pacific.”
Rick Emert contributed to this story.
Pacific gas prices for October
The new gas prices per gallon for Army and Air Force Exchange Service customers in the Pacific are:
Unleaded — $2.597Premium — $2.788Diesel — $2.60Guam
Unleaded — $2.669Midgrade — $2.719Premium — $2.819Mainland Japan and Okinawa
Midgrade fuel will remain at $2.03 a gallon for the time being. AAFES is waiting for a new fiscal 2006 contract from its Japanese supplier and could adjust the prices accordingly sometime during the month, according to AAFES officials.NEX prices not yet set
The Navy Exchange had no word late Thursday on what prices will be at its gasoline pumps in Japan come Saturday.
As of late Thursday, Jerry McMahan, NEX services manager at Yokosuka Naval Base, said NEX still was waiting to see what its fiscal 2006 cost per gallon to purchase gasoline from the Defense Energy Support Center would be.
“Right now, we’re waiting for the cost. As soon as we know the cost, we can determine the retail,” he said, adding that the Navy Exchange Service Command in Virginia Beach, Va., sets the retail price for NEX gasoline in Japan.
Midgrade gas at NEX pumps currently sells for $2.09 per gallon.
— Stars and Stripes