Gasoline prices surpassed $3.50 a gallon nationwide for the first time and oil jumped to a record on Monday as the long rise of energy prices showed little evidence of giving way to recession fears.
The national average price for regular gasoline is up 22 percent from a year earlier, according to AAA, the automobile club. Some analysts expect it to approach $4 a gallon this summer, when demand is at a peak. Diesel fuel prices reached a record $4.20 a gallon on Monday, on average, compared with $2.93 a gallon a year earlier.
In trading on the New York Mercantile Exchange, crude oil for next-month delivery settled Monday at $117.48 a barrel, up 79 cents, a new high. Oil prices have more than quadrupled in the last five years, and some analysts say that oil will reach $125 a barrel this year.
The latest rise in energy prices was prompted by reports that a Nigerian rebel group had blown up pipelines in the Niger Delta. An earlier attack on a pipeline, last week, forced Royal Dutch Shell to curtail exports by 169,000 barrels a day.
Because there is little spare capacity worldwide and supplies are tight, slight disruptions in oil production anywhere can push up prices.
Oh well, there’s always someone worse off than yourself. And we’re here in the UK.
My cheapest local garage is selling unleaded petrol at £1.09 per litre. If my arithmentic is right, converting sterling to US dollars and litres to US gallons . . . that means the equivalent of $8.21 per (US) gallon.
Conversely If we were paying the equivalent of $3.50 per US gallon my petrol station would be selling unleaded at 46p per litre.
We still manage to live, somehow, with petrol at over $8 per gallon . . . so we do hope you find a way of scraping together the cash to pay for gas at 46p ($0.92) per litre.
Ditch the SUV and drive something that gets twice the mileage. If everyone in North America drove a Corolla, Focus, or Civic, supply might actually begin to exceed demand.
Only $3.50 per gallon? That would be cheap in California!
#3 Randy Muller, you are so right. We’ve passed $4 here in our fair city. It’s only going to get worse, unfortunately.
As for energy inflation, I am waiting for solar to get just a little cheaper, and for electric car batteries to last 12 hours. I have advised my teenager to consider a bicycle with solar electric assist when she goes to college this year, but she is not enthused with the idea which she considers an obvious “loser”.
When solar gets a little cheaper and batteries longer lasting (I give it 5-10 years), I hope to have an electric car.
When that happens, the mid east nations may wake to realize they are in the middle of the desert with nothing to eat but oil.
In the meantime, I have cut my heating and air conditioning bills with a pellet stove, and a whole house fan, and by putting mylar insulation in my attic.
Shari
I am waiting for solar batteries to last 12 hours. When they do (a matter of a few years) I will have solar panels installed on my south facing roof. My goal is to have home and care off the grid completely in 10 years. If I had a few acres, I would put in a wind mill and install a geothermal system, and have it immediately but I plan to continue living in my little suburban subdividion. I believe solar and wind power will sweep the world the same way that computers did. (However, like Apple and Microsoft) it is not clear which company will “win” the lions share of the market yet.
Shari
What is interesting, is that final geological surveys are being done this summer in South and North Dakota to confirm an oil field there will pail in size what Saudi Arabia has. It is estimated to be over one half billion barrels, and who knows, if the environmentalist ease up a little, we may even be able to use it someday. It has been known to exist since 1953.
yes #7, the MSM does not seem to like good news (would not want to boost the President’s approval ratings and all). Here it is:
Massive Oil Deposit Could Increase US reserves by 10x
http://www.nextenergynews.com/news1/next-energy-news2.13s.html
#3. The supply already far outstrips demand. What you are seeing is pure speculation. Like CSCO in 1999. the trend is your friend, etc.
There is no oil shortage.
The important thing to remember is that China and India are becoming major competitors for oil, and this means they’re going to compete with us for the oil that our refineries need for the gasoline they produce. The more motor vehicles they put on their roads, the more gas they’ll need, and the more oil they’ll need for THEIR refineries. Guess where that oil comes from! The same place that OURS does! The result? Competition, and that means higher prices at the pump for us. That also means that our oil companies are going to have to find new places for drilling…..including deep off-shore sites.
#10 “Competition, and that means higher prices at the pump for us.”
Temporarily. After that, not only will wind and solar greatly reduce the home and car burden, but new sources will be found to replace oil needs for plastics and fertilizer. Oklahoma’s fields have been capped, and are said to be larger than Texas’.
It would be certainly wise to do what we can to lower our fuel costs, however I for one am not investing in oil companies. Their lunch will be eaten in all to short a time.
We could always follow the French and Japanese lead – they get over 70% of their electricity from nukes.