S.D. May Have an Edge in Oil Crisis : Energy: Since many local businesses rely on electricity, the economy is not likely to be hit as hard.

Like most motorists around the country, San Diegans are already paying more at the gas pump because of recent events in the Middle East.

In addition to a state gasoline tax increase of 5 cents a gallon that went into effect Wednesday, retail gasoline prices rose again Friday an average 5 cents a gallon as a result of market reactions to the Iraqi invasion of Kuwait, said Mary Ann Barngrover, a Chevron USA spokeswoman in La Habra.

West Coast wholesale spot prices rose another 8 cents a gallon Monday, a jump that is likely to translate soon into further price increases at the pumps, industry observers say.

However, San Diego’s overall economy may suffer less than those of most other major cities because the area is not a heavy industrial center, nor is it a major transportation hub. Moreover, electric rates will probably not increase over the next year because of the climb in oil prices, local officials said.

Max Schetter, senior vice president of the Greater San Diego Chamber of Commerce, said most San Diego companies do not rely heavily on oil to generate power and therefore are not hit as hard by price increases.

“San Diego has mainly smaller companies that run on electricity,” Schetter said.

Roger Renstrom, a spokesman for Rohr Industries, a large aerospace manufacturer based in Chula Vista, said Rohr does not use oil to generate power in its area plant. The company is a heavy user of electricity, and is concerned about oil prices mainly in how they affect electric rates, he said.

“We are not dependent on oil, and the price of it is not going to impact us at this time,” he said.

Fortunately for San Diego businesses, local electric rates will probably be more stable than oil prices. Because San Diego gets its electricity from a variety of sources, including about 50% from the San Onofre Nuclear Power Plant, increases in oil prices do not necessarily result in a comparable increase in electric rates, said Jim Nugent, fuel manager for San Diego Gas & Electric Co.

An SDG&E; purchase of 285,000 barrels of oil shortly before the latest Mideast crisis will also help prevent rate increases, he said. The company supplements its outside sources of power with electricity from its own plants that mainly burn natural gas in the summer and oil in the winter, Nugent said.

The company saved millions of dollars by buying the oil for $14.65 a barrel last month, about $9.50 a barrel less than Monday’s price, Nugent said. SDG&E; has a 1.6-million-barrel reserve, enough to last the utility through an average winter, he said.

“San Diego is in good shape for the winter,” Nugent said. “Fortunately, we bought those barrels and got them about two weeks ago, so we’re not in the oil market currently.”

David Kusumoto, an SDG&E; spokesman, said it is difficult to predict how electric rates would have been affected if the company had not made the bargain purchase, because electricity demand and the cost of other sources of power are also big variables.

“Certainly, there would be upward pressure,” Kusumoto said. “But it would not necessarily be reflected in a customer’s bills because of all the other factors that go into a person’s electric bill.”

The Navy, one of San Diego County’s biggest users of petroleum products, also appears to have sufficient supplies of fuel. Naval Supply Center spokeswoman Mary Markovinovic said that, although the amount of fuel in the Navy’s Point Loma storage tanks is classified information, the crisis has not affected the Navy’s use of fuel.

“Right now there are no indications that we will have to cut back on training operations or other activities here,” Markovinovic said. “We have not gotten any word on that.”

With a capacity of 1.1 million barrels, the Navy’s Point Loma storage tanks are the main Southern California military supply center, she said. Between 5 million and 6 million gallons of diesel, ship and jet fuel were distributed from San Diego last year.

If an increase in fuel prices forces the Navy to cut back on its fuel use, it is unclear how San Diego operations will be affected.

“Someone in the Pentagon is going to have to make a decision on where the fuel money is going to go,” Markovinovic said. “It may be that they’ll cut back somewhere else or in local operations, but we don’t know that yet.”

Schetter of the Chamber of Commerce said another reason San Diego is less affected by oil prices than similar-size cities is that few major trucking operations are based here. San Diego “is not a hub, just a destination or origination market” because it is not centrally located, Schetter said.

“We don’t have that many wholesale trucking firms compared to Los Angeles, San Francisco or other cities of similar size,” he said.

In 1987, the most recent year for which figures are available, San Diego was the 19th-largest county in the nation, but ranked 59th among metropolitan areas for motor freight transportation and warehousing revenues, Schetter said.

Managers of local trucking firms varied in their reaction to the recent oil price increases. Bob Neal, manager of Bill Signs Trucking in El Cajon, said a 5-cent increase in fuel prices translates into an operating increase of about $5 per truck a day, a relatively minor expense. The company owns 10 trucks and specializes in construction and industrial equipment moving.

“The bottom line is, it really doesn’t make a significant difference,” he said.

But not all area trucking companies can absorb the increases so easily. Rose Pullaro, president of A.R.O. Trucking, said higher fuel prices could drive her three-truck company out of business.

“The price of fuel is killing me,” she said. “Right now, it’s week to week. . . . When you don’t have a lot of cash flow, when you’re not big, I think it hits smaller people like me more.

“I don’t know what I’m going to do. I may have to close the doors. I don’t want to. It’s my life, but it’s one thing after another.”