$4 gas coming soon to a pump near you
More experts predict higher prices by late spring or early summer. If war breaks out in the Middle East, the national average could top $6 a gallon.
Another day, another gas price prediction, it often seems. But the latest projection of $4-a-gallon gas by summer or even sooner is gaining traction.
A national average of $4 a gallon means much higher prices -- at least 50 cents more -- in places like Los Angeles and New York.
Also be aware that if war breaks out in the Middle East, the price of gas could reach or exceed $6, says Gregg Laskoski at the GasBuddy.com blog.
There's no questioning the fact that any attack in the Middle East would certainly send crude oil soaring. . . . So if you're seeing $3.50 a gallon in your local market and Israel attacked today, add $2.50 to that and now we're looking at $6 gasoline.
Post continues below.
Lest you've forgotten, the record high U.S. national average was $4.11 in July of 2008 -- when we all started adopting the practices of hypermilers -- not for fun, but out of necessity.
Here's what some experts are saying:
- Gulf Oil CEO Joe Petrowski told CNBC that Middle East tensions plus closing refineries -- particularly on the East Coast -- could propel gas prices to the $4 mark.
- Patrick DeHaan, an energy analyst for GasBuddy.com, expects $4 gas by Memorial Day, according to USA Today.
- "We'll get over $4 a gallon, but it's going to be tough to sustain that level," Brian Milne of Televent DTN told USA Today. "People will drive less."
People are already doing that, so what's driving a price increase? USA Today explains:
Renewed tensions in the Middle East are bolstering crude prices, while speculators are boosting futures contracts, betting on global supply disruptions and tighter refining capacity. (Tom) Kloza (of the Oil Price Information Service) notes that several U.S. and overseas refiners have experienced temporary or permanent closures.
Also boosting prices is the higher seasonal demand that comes with summer vacations, plus a federally mandated switch from winter gas formulations to costlier ones for summer. The summer ones, designed to reduce emissions, require further refining steps.
Any price increase will come on top of notably high prices for this time of year. AAA's Fuel Gauge Report says the national average is $3.513 for regular, up substantially from $3.388 a month ago. Last year at this time, it was $3.126. January's gas prices were the highest for that month ever recorded.
There is one bright spot in these predictions of $4 gas. "I don't think it is going to stay there for long, but it looks pretty certain to get there," Kloza told the News-Press of Southwest Florida.
In other words, we'll respond by driving less -- something we've gotten used to. Demand is down to levels last found 12 years ago.
And maybe it won't be so bad. Despite widespread predictions of $4 or more for gas last year, the national average peaked at $3.98 in May and quickly dropped.
More on MSN Money:
- 7 ways to save on gasoline
- Spiking gas prices could ding consumer recovery
- Wall Street's games about to hit gas prices
- Why you should love $5 gas
Supply and demand has been completely taken out of the equation as far as pricing of gasoline. I have a question or two. Why are the refineries closing? Are they closing because of a lack of demand, out dated and needing a remodel or just because the refiners need more cash to get their cut larger out of the pie?
With the uneasiness in the Middle East plays right into the hands of the speculators. The speculators, et al, are the driving force in determining the price of the petroleum products. If someone so far as blinks wrong in the speculators' mind, up goes the price of oil and gas. People have a short memory when in 2008 the price for a barrel of oil was hovering around $150 US and when the Justice Department threatened to investigate why the price of oil was rising so quickly, the price bubble burst. I am willing to bet that the vast majority of the oil speculators if they had to, could not accept delivery of the oil or gasoline that they are betting on the price to go higher and higher.
The short lived saber rattling that Iran did in January was to help themselves to get a better price for their oil (by the way is not sold in dollars) so they can whether the new round of economic sanctions placed on them by the UN. If the nut jobs in Iran want to close the Straits of Hormuz they will be in for a very big surprise by the response of the world and not just of the US.
We are swimming in oil in North Dakota, no way to get it down the line, no keystone pipeline. We do not need This song and dance tight supplies, high demand, ect. What we need is an administration that has a set of real big BALLS and stop this bull---- . There is no reason that gas couldn't be 1.99 at the pump. We the people need to contact our senators and representives and tell them that the end of the line is very close . Get this crap handled NOW! We put you in office to get things like this fixed and if you cant someone else can and will. Better call your old job and ask if you can come back . GET THIS THING FIXED NOW!
THE ONLY ONES TO BLAME IS US, WE IDIOTS KEEP
ELECTING THE SAME A__ H____ YEAR AFTER YEAR, I WILL NEVER VOTE
FOR ANY INCUMBENT EVER!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
BOTH STATE and FEDERAL!!! WAKE UP AMERICA FIRE THE WHOLE
and let the new guys know we will ax you to if you start the same old S___.
DON'T BLAME THE OIL COMPANIES, PUT THE BLAME WHERE IT BELONGS, CONGRESS, SENATE, AND THE WHITE HOUSE, THEY LACK COMMON SENSE
Three years of Obama attacking the enegry sector, refusing drilling permits and the EPA closing down refineries baked this cake.
Now the turmoil in the middle east and Iran are adding the frosting.
If Obama had passed the Keystone Pipeline, it would immediately bring in 13,000 jobs and 120,000 spin off jobs to Americans.
The Pipeline was approved by the Dept of Agriculture, Dept of Interior, Dept of Transportation, Defense Dept, Justice Dept, Homeland Security, Dept of Commerce and the Environmental Protection Agency.
It would give us domestic oil without ever having to go to another country for the next 30 years!!!
The only person not to approve it was Obama?? So, when you are pumping gas at $4.00 per gallon think of the moron in the Whitehouse!!
Please stop blaming the economy for high gas prices when gas prices are the ONLY reason for this bad economy. It's not the Middle East or closing refineries driving up prices...it's GREEDY SPECULATORS. I've never seen gas prices go down for the holidays. Where I live, they were $3.49 just before Thanksgiving and were down to $2.97 at Christmas. Less than 2 months later we are back at $3.49. Traditional (before speculation) gas prices would slightly increase during the holidays as travelers increased the demand. Gas prices are now manipulated by something other than supply & demand. IF YOU WANT TO FIX THIS ECONOMY QUICKLY, SIMPLY LOWER GAS PRICES (under $2 per gallon). I promise you, the economy would turn around so fast it would make your head spin.
The Bakken mine under North Dakota has enough oil to supply the United States for 2000 years. And now they found another oil formation that could be seperate from the Bakken underneath it that looks to about cover the entire state.
We have more than enough oil within the United States to support ourselves and no longer rely on foreign oil.
Why are we not turning the tables on these other countries in regards to oil? Why are we continuing to let these oil companies push the United States around? And most importantly, why are we letting our Senators, Congressman, and other supposed 'leaders' of the US get paid off by these oil companies?
How long until the people of the United States stand up for themselves and get rid of these corrupt bastards??
What a disgrace the last few years have been with gas prices. For years gas at the pumps varied by pennies and it seems since Hurricane Katrina gas has been up and down (mostly up) and in the $3-$4.00 a gallon range. There is absolutely no justification for these ridiculous prices as it states in the article: Demand is down to levels last found 12 years ago.
Furthermore OPEC had cut production back (almost 2 million barrels a day) because they were swimming in OIL no one was using. So....since consumption is down basic Economics would dictate lower prices at the pumps since the demand is down but yet somehow, someway the jerks on Wall Street put a spin on it and OIL keeps rising everyday to line their GREEDY pockets and our WORTHLESS politicians in Washington do nothing to stop the LIES & MANIPULATION at our cost!!!!!!!!!!!!!!!!!!!! And please if it wasn't the tensions with IRAN right now they would find other excuses to artificially inflate the price. We the people are being RAPED!!!!!!!!!!!!!
Nothing like "artificial" pricing. The oil companies, ALL of them are a joke and need to be investigated. Oh, but wait.. That's right!! Those that are supposed to be doing the investigating are getting more than a little payola for the gasoline scam.
Go electric or natural gas. Problem is that the same outfits screwing the American people over gasoline prices have their fingers in the alternate modes of powering vehicles. I guess, when you have the money, you can do pretty much anything to make more.
Only one word for this scam and it is BULL$HIT!!!!
It has to end at some point doesn't it. Last election it was falling down to 2.50 a gallon. now we can't prevent it from going to 4 per gallon WTF. Some one in a position of power needs to pull their heads out of their asses and straighten this situation out.
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