Gas prices hit $3.50 a gallon


Published/Last Modified on Tuesday, April 22, 2008 3:06 PM MDT


NEW YORK (AP) — Rising gasoline prices tightened the squeeze on drivers Monday, jumping for the first time to an average $3.50 a gallon at filling stations across the country with no sign of relief.


Crude oil set a record for the sixth day in a row — this time closing above $117 a barrel — after an attack on an oil tanker in the Middle East rattled investors.

“It’s killing us,” said Jean Beuns, a New York cab driver who estimated he now makes $125 to $150 less per month than in the fall because of costlier gas. “And it was so quick. Every day you see the price go up 5, 6, 10 cents more.”

Diesel prices at the pump also struck a record high of $4.20 a gallon, according to AAA and the Oil Price Information Service. That’s sure to add to truckers’ costs and drive up the price of food, clothing and other goods shipped by truck.

“You and I are going to pay more,” said Bob Costello, chief economist of American Trucking Associations. “Exactly how much ... I can’t tell you, but it’s got to show up.”

Gasoline prices are expected to keep climbing as they trace the path of crude. Oil prices are charging ahead along with a host of commodities that are enticing speculators seeking hedges against a weakening dollar.

Light, sweet crude for May delivery rose to a record $117.76 a barrel on the New York Mercantile Exchange before settling at $117.48, up 79 cents from Friday.

Gas jumped more than a nickel over the weekend and is up 23 percent from a year ago. Drivers in New Jersey are paying the least, while drivers in California pay the most, $3.86 a gallon for regular unleaded. The Energy Department predicted earlier this month that monthly average gasoline price will peak at more than $3.60 per gallon in June and could even reach $4.

“It’s uncharted territory,” said Tom Kloza of the Oil Price Information Service. “I don’t think we’re done, but I have to believe we’re in the eighth or ninth inning” of price increases.

The higher prices are already prompting some drivers to cut back. In downtown Chicago, Sharon Cooper spent $52 to fill up three-quarters of the tank in her Toyota Highlander SUV. She said she tries not to let the prices get to her, although she too is changing her habits and buying a bike to commute to work.

Energy Department data show Americans used about 1 percent less gas in the four weeks ended April 11 than they did a year earlier.

That change, while not drastic, is significant, Mariano Gurfinkel, project manager at the Center for Energy Economics at the University of Texas at Austin, who expects per-capita demand to drop further this summer unless gas prices fall.

Americans will continue to drive, but some may change their summer vacation destinations as gasoline costs continue to make a bigger dent in their pocketbooks, Gurfinkel said.

Crude oil rose Monday after the 150,000-ton tanker Takayama was struck off the coast of Yemen as it headed for Saudi Arabia, its Japanese operator, Nippon Yusen K.K., said.

Kyodo News agency reported that the Japanese tanker was fired on by a rocket launcher from a small boat. None of the ship’s 23 crew members was injured, but several hundreds of gallons of fuel leaked before a 1-inch hole in the tanker’s stern was repaired, the company said.

Meanwhile, militants in Nigeria renewed their attacks on oil facilities in the south of the African nation. Nigeria is a major supplier to the U.S., and attacks in the past two years have cut nearly a quareter of the country’s oil output.

“There’s clearly some geopolitical tension in the market,” said Mark Pervan, senior commodity strategist at the ANZ Bank in Melbourne, Australia. “This will die down, but the market is pretty jittery at the moment.”

An OPEC official also said over the weekend that the group was not likely to increase production. The official said oil prices would likely rise and said OPEC might boost production if the price pressure was because of a supply shortage, something he doubted.

In other Nymex trading, heating oil futures rose 1.9 cents to settle at $3.3114 a gallon while gasoline futures fell about a penny to settle at $2.9791 a gallon. Natural gas futures jumped 14.6 cents to settle at $10.733 per 1,000 cubic feet.

Comments

    Legal AZ Resident wrote on Apr 23, 2008 12:18 PM:

    " Thats nothing new. Rising gas prices. Like i said before brace yourself. I think we should start walking and riding bikes. We can save money on gas and insurance! "

Write a Comment

Comment posters are responsible for the opinions they express and the accuracy of the information they provide. We urge comment writers to treat this as a public forum where manners matter. We encourage a collegial, non-insulting tone. All readers comments must be approved by our staff before posting to the Web site. They review submitted comments periodically during the day for offensive or off-topic content before posting. Be aware, in accordance with the Communications Decency Act and provisions upheld in judicial appeal, that you are responsible for comments posted on this Web site. The Douglas Dispatch is not liable for messages from third parties.

DO NOT POST:
* Potentially libelous statements or damaging innuendo.
* Obscene, explicit, or racist language.
* Personal attacks, insults or threats.
* The use of another person's real name to disguise your identity.
* Comments unrelated to the story.
* Personal Information (phone numbers, addresses, etc.)

Opinions, advice and all other information expressed in douglasdispatch.com's reader comments represent the individual's own views and not necessarily those of the Douglas Dispatch. The Douglas Dispatch does not endorse and is not responsible for statements, advice or opinions offered by anyone other than authorized Douglas Dispatch spokespersons.

Your thoughtful contribution to the online discussion is appreciated.

(optional)
   









Contact Us

Email the Editor
530 11th Street (85607)
P.O. Drawer H
Douglas, AZ 85608
tel: 520.364.3424
fax: 520.364.6750