How High Will Gas Prices Climb?
Speculation on Wall Street about Libya unrest drives up prices.
Gas prices across the nation hit a 30-month high Friday, with the national average for regular gasoline reaching $3.74, according to AAA.
That’s an increase of 22 cents since March and an 88-cent increase from a year ago, and with the summer travel season approaching, motorists can expect prices to keep rising.
“It’s not a good situation, the economy is already struggling and the increase in the price of gas will increase prices of other consumer goods like groceries and electronics that have to be shipped and driven to stores,” said Windy VanCuren, spokesperson for AAA Mid Atlantic.
VanCuren also said one of the largest factors driving up gas prices is the speculation on Wall Street about the unrest in Libya.
A recent story by Reuters stated the U.S. and some other western nations, including the European Union, have placed sanctions on oil exports from companies in Libya that have connections to Muammar Gaddafi, the Libyan leader currently facing a massive rebel uprising in his country. According to MSNBC, nearly 80 percent of Libya’s oil reserves are in the Sirte Basin, an area split in terms of control between Ghadafi and rebel forces.
“We are cautiously optimistic that prices will retreat. Back when averages hit a record high of $4.11, the price of crude oil was $147 a barrel,” VanCuren said. “Prices closed at $112 on Friday, so only time will tell.”
The AAA spokeswoman also commented that regionally, the cost of living and local tax intensities greatly factor in to determining the price you will see at your local station.
This is why it is not unusual to see one station with a price per gallon five to ten cents cheaper than the station right up the street. Regardless, the fact remains for motorists in Northern Virginia and throughout the nation, the price of gas affects nearly everything they do.
“I cut down on going out to eat, going out with friends, I have to save money for gas, said Ali Khraibani, a Falls Church resident who stopped for gas at a Sunoco station at Loehman’s Plaza shopping center on Monday. Khraibani is a junior IT student at George Mason University, and commutes from Falls Church to GMU’s Manassas campus four days a week for classes. “I put about $10 in my tank everyday just to get me there and get me back. At the end of the day we have to go home and provide meals for our children and families, so I can’t just throw all my money into the pump any time I want.”
There’s no telling exactly how high prices will go, or when (if ever) they will retreat. You can use AAA’s online fuel price finder to locate the lowest gas prices in your area here: http://midatlantic.aaa.com/PGA/FuelConservation