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New Gas Price Record: $3.07

No Relief in Site Until at Least Mid-Summer

By Joe Benton
ConsumerAffairs.com

May 15, 2007

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The nationwide average price for regular gasoline in the U.S. reached a new record high of $3.07, blowing by the previous record of $3.057 set immediately following Hurricane Katrina on September 5, 2005.

Prices are now above $3 in 31 states and experts predict more increases to come as consumers hit the road for vacations and other summer travel.

While no one is certain when prices may ease, there is some moderately good news for consumers as gasoline futures for June delivery fell 5.09 cents to settle at $2.30. A hurricane or perceived global crisis could send prices back up quickly though.

Unlike past price hikes, the current increases are not tied to the price of crude oil. They are caused by the failure of refineries to produce enough gasoline to keep up with demand.

Mid-grade gasoline is selling for a national average of $3.26 and premium sells for $3.37.

The cheapest regular self-serve gasoline in the country is found in Boiling Springs, South Carolina for $2.65 and the most expensive gallon is on sale in Needles, California for $3.99.

One month ago regular sold for $2.79 and one year ago it sold for $2.88.

The government predicts prices will fall in June and July to about $2.90 a gallon but also warns that the projection assumes no significant unplanned refinery outages or crude oil production losses.

The high prices have prompted the Texas legislature to consider suspending the state's 20-cent gasoline tax over the summer as prices begin to hit the $3 mark in some areas of Texas.

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