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Gas Prices Rising Rapidly as Crude Oil Price Jumps

Regular self-serve up 20 cents in two weeks

By Joe Benton
ConsumerAffairs.com

February 25, 2008
Gas prices are up almost 20 cents over the past two weeks with the national average price now at $3.14.

The increase leaves the price of regular self-serve gasoline almost 70 cents higher than the average price this time last year.

One month ago regular self-serve gasoline sold for an average nation price of $2.99 and one year ago a gallon of regular cost $2.30.

The big jump in prices is linked directly to international oil prices according to industry analyst Trilby Lundberg. "It is entirely from rising crude oil prices," she said.

U.S. oil prices broke a record high record last week amid expectations the Organization of the Petroleum Exporting Countries (OPEC) could maintain or reduce output at its March meeting, rather than increase to meet calls from consumers.

Lundberg flatly rejected the notion that OPEC would cut production but she suggested prices will continue to rise.

"If crude recedes a little it will be from the normal, world oil demand downturn that happens during the warmer months. But even that would not prevent further rises at the pump in the U.S. because very soon gasoline will take on its own price strengths from rising seasonal demand," she said.

Some analysts are forecasting that gas prices will rise this spring to new records near $3.75 or $4 a gallon.

The U.S. Energy Department is predicting gas prices will peak near $3.40 a gallon this spring.

The most expensive gallon of gasoline is now on sale in Kailua, Hawaii for $4.09. The cheapest gallon is found in Murfeesboro, Tennessee for $2.78.

Here is a look at some gasoline prices from around the country:

California: Supply worries sent the average gasoline price soaring in California which has the highest prices in the U.S., the Automobile Club of Southern California reported.

The price of a gallon of self-serve regular gasoline went up 11 cents higher in Los Angeles County and 14 cents in Orange County.

In Los Angeles County, the average rose to $3.20, 2 cents less than last month, but 52 cents more than this time last year.

The Orange County average rose to $3.15 a gallon, 5 cents more than last month and 51 cents more than this time last year.

"In the past week, California resumed its usual place as the state with the second most-expensive gasoline next to Hawaii with these double-digit price increases," Auto Club spokesman Jeffrey Spring said.

Texas: Record-high crude oil prices have caused retail gasoline prices to skyrocket in throughout the state.

The weekly AAA Texas gas price survey finds regular self-serve gasoline climbed 12 cents this week to an average of $2.99 per gallon.

Auto club spokeswoman Rose Rougeau said 8 of the eleven Texas cities in the AAA survey posed double-digit percentage increases this week. That's after crude oil prices surged past $100 per barrel on the basis of speculation and the prospect of OPEC production reductions.

San Antonio has the lowest average in this week's survey at $2.95 per gallon, up 9 cents from last week. Texarkana has the most expensive gas in the state at $3.06 per gallon, up 18 cents from last week.

Pennsylvania: The AAA Mid-Atlantic auto club reported that the region's gasoline prices continued to climb over the weekend and new records for diesel were set February 25.

The average price per gallon of regular unleaded rose by a penny each in Pennsylvania and New Jersey, by 2 cents in the five county Philadelphia region and by 3 cents each in Delaware and South Jersey.

The average price per gallon for diesel rose in Pennsylvania is now $3.72 and southern New Jersey is $3.49.

The current average per gallon for regular unleaded gas is $3.16 in Pennsylvania, up 11 cents from a week ago. The average is $2.95 in New Jersey, up 10 cents from a week ago.

North Carolina: Gas prices have been increasing over the past two weeks and experts say they can't predict when or if that will stop.

Gas stations in the Charlotte are selling regular self-serve for an average of $3.13 per gallon. That is nearly $1 more than averages a year ago and not far behind the record of $3.21 set in September 2005.

The average price for regular gas in the Charlotte area has increased 9 cents per gallon in the last month.

Carol Gifford, spokeswoman for AAA Carolinas, said it could be a combination of things, from the level of local fuel inventories to international news about oil trading.

"We've noticed that basically any little problem in the oil pipeline results right now in the fluctuation of prices," she said. "So even things that look like they shouldn't have an impact, like a fire in a refinery, can have an impact."

Florida: Gas prices are soaring in Florida.

AAA said the average price of regular unleaded shot up another 6 cents a gallon to $3.22 a gallon.

That is up 14.5 cents a gallon since last week.

People told the auto club that they have seen their local gas stations raising prices by 10 cents or more in a single day.

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