Gas Prices Soar Nationwide

by Rene Villaroman/


LOS ANGELES — Motorists in Northern California are already paying more than $4 a gallon for gas, the Automobile Association of America (AAA) reported on Tuesday. In Oakland, a Shell station sold premium gas at $4.05 a gallon, and in the State capital of Sacramento, gas prices are $1 higher than they were one year ago.

Analysts predicted that it will only take weeks before nationwide gas prices reach the $4 level. The national average this week for regular gas topped $3 per gallon, and motorists could be paying record prices this holiday season, the analysts added.
“Usually Americans have more money to spend each holiday season because gasoline prices tend to give up 25 per cent of their value after summer,” said Tom Kloza, an analyst with the Oil Price Information Service. “But this year there is a second coming of the gasoline rally that may be the Grinch that stole Christmas.”

Barring some unexpected developments like a big drop in the price of oil, Kloza and other experts said, gas could be headed towards $4 a gallon by spring. Gasoline prices have trailed surging oil prices, but they are starting to catch up as crude oil nears $100 a barrel. Oil settled down slightly on Tuesday, at $96.37 a barrel.

On Wednesday the national average gas price for unleaded regular reached $3.04—an increase of nearly 28 cents in the last month– according to AAA. Average gasoline prices in November had never exceeded $3 a gallon before this year. A year ago, the average price at the pump was $2.20, meaning it costs roughly $12.50 more today to fill a car with a 15-gallon tank.

In some states, like California, for example, the average price motorists are paying is higher. On Wednesday that average was $3.31. In the Northern California city of Stockton, the average price is $3.30 a gallon, and in Modesto, it’s a bit cheaper at $3.28 a gallon for regular gas. This year, the record price for regular gas was $3.43 and it was posted in May, according to AAA.

In Houston, Texas economist Barton Smith said that gas prices could breach the $4 a gallon mark by next summer. He added that despite the spikes, consumers will pay up. If, as a result of spiraling gas prices, Americans are driving less over all, it is not evident in the national statistics. Americans have consumed an average of 9.3 million barrels of gasoline a day so far this year, an increase of 0.6 per cent from last year, says the Energy Department. But there are signs that many Americans are feeling the pinch, and business economists are worried that rising gasoline prices will cut consumer spending this holiday season.

“I actually drive to Tahoe, but I can’t afford to drive right now,” says Diana Quintero, a driver from Houston, Texas. She was forced to change her driving routes and even her car. “I can’t afford $80 a week. I just can’t,” she said. Farhan Muhammed can only put $5 in his tank to make ends meet. “It’s really hurting everybody. It’s really expensive,” he said.

Economist Smith said whether prices go up or down, Americans have not noticeably slowed down in their consumption of gas. “Not only will the spikes hurt at the pump, it would trickle down and affect the day-to-day expenses,” Smith said. “It affects food, clothing, and electronics. You’ll see the effects at the grocery store,” Smith said.

“Generally, I go out less now,” said Janet LaVigne, 51, who lives in Cleveland, Ohio. She fills her 1994 Mazda Protégé daily to deliver newspapers in communities outside Cleveland. “I do my job and come home. I used to go out to the movies, sometimes to restaurants, but now I can’t afford the gas.”

Sara Scheerer, a 17-year-old high school senior, said the high cost of fueling her 1999 Ford Explorer to drive to basketball team practices and school had forced her to get a salesclerk job at Walgreens. “I can’t spend as much money on other stuff like clothes,” she added.

Geoff Sundstrom, an AAA spokeman, projected that the average regular gas prices nationwide would be at least $3.20 by Christmas. Amanda Kurzendoerfer, a commodities analyst at Summit Energy Services Inc., predicted a price as high as $3.50 by Christmas—which would be a record for any time of the year.

Kurzendoerfer also predicted that while oil prices could exceed $100 a barrel in the near term, they will average $75 to $80 in 2008. Still, she said gasoline prices would most likely be higher in the spring when oil refineries will have to produce more expensive blends for warmer weather and the heavy summer driving season begins.

In the Los Angeles area, regular gas averages from $3.13 to $3.28 a gallon. At a Unocal station in Beverly Hills, premium gas is pushing the $4 level at $3.99. It could breach that level any day now.

As a consolation, American motorists are still ahead. In the United Kingdom, the price of a gallon of gas has reached the equivalent of $8 on Wednesday. (

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