Instead of the usual low gas prices around this time of year, they’ve been increasing.
Despite gas being dramatically high, Americans demand for it has only risen 0.7 percent in the past year.”The gas prices are outrageous! Until they go down, I am keeping my car parked,” said junior social work major Daniella Jackson.
During the week Hurricane Katrina devastated the Gulf Coast, gas prices rose 46 cents.
The prices are up from a year ago because of “crude oil costs, as unrest in Libya sent U.S. oil trading above $100 a barrel,” according to reuters.com.
The prices rose by more than $8 a barrel last week. “Every $1 increase in a barrel of oil is equal to a 2.4-cent rise in a gallon of gasoline,” the Web site resumed.
The site posted figures. Some of the prices over the last week increased by “23 cents in Houston to $3.22, 16 cents in New York City to $3.40, 25 cents in Miami to $3.48, 24 cents in Chicago to $3.56 and 18 cents in San Francisco to $3.75.”
Diesel fuel prices reached $3.72 a gallon, up 86 cents from a year ago, according to the Energy Department’s weekly survey of service stations. It is feared that the dramatic increase in fuel prices could slow down the economic recovery.
“(The gas prices) causes you as the consumer to spend less,” said Lawanda Sowell, junior psychology and special education major. It increases unemployment rate which leads to companies and factories closing down,” she continued.
Times have gotten so hard that a St. John the Baptist Parish motorist called 911 because of gas prices.
The unidentified motorist stated that when he pulled up to the gas station, the price read $3.05 per gallon. But in the midst of pumping, the price shot up to $3.19. The motorist confronted the attendant, but was not successful.
Gasoline prices escalated nearly 20 cents per gallon within the past week. On average, a gallon of regular gas costs $3.37.
Meanwhile, oil prices fell below $97 per barrel after shooting above $100.
According to the Associated Press, “Traders said there is a ‘fear premium” of $15 to $20 per barrel built into the price of oil to account for further disruptions in shipments as protest movements sweep through North Africa and the Middle East. Oil prices should slide as the situation in Libya stabilizes, analysts said.”
Due to the continuation of unrest in other major oil producers such as Algeria and Oman, gas prices may stay at this peak.
“The market is going to be on a hair trigger. PFGBest analyst. “If something else happens, get ready for prices to shoot back up.” Phil Flynn said.
Company officials say that the Arabian Gulf hasn’t been forced to cut its daily production of 220,000 barrels, most of it bound for Europe. Libya produces about 1.6 million barrels of oil per day.
“(Gas prices) actually places us back. If people don’t spend then the government and businesses get no money which means debts aren’t paid which forces us to borrow more and more,” Sowell said.
President of Strategic Energy & Economic Research, Michael Lynch, expects oil prices to continue to fall this week as rebels strengthen their hold over Libya.
With oil prices so high, “This is not going to be a robust year for the economy,” Lynch predicted.