$4 Per Gallon of Gas in Our Future?

Over the weekend, plezWorld pumped $30 of gasoline into the SUV, that thirty dollars filled less than half of the tank! I drove to DisneyWorld a few weeks ago, other than tickets to the parks, the cost of gasoline was our biggest expense (over $300).

A report in the New York Times says that for the first time, regular unleaded is over $3.50 a gallon nationwide. According to AAA, gasoline prices will be at or near $4 a gallon by this summer.

Simple economics is a major driver of price: OPEC countries (which control about 40% of the oil production) have kept their supplies to the global market constant as the demand for oil has risen with emerging economies in Asia. The demand here in the United States is as high as it ever was. The price of gasoline is 22% higher than last year.

The price of oil topped $100 a barrel earlier this year, it is now hovering around $120. Some analyst expect the price to reach $125 per barrel this year. The price of crude oil has quadrupled in the past five years!

In addition to the increased demand for steady supply, the slowing economy and the weak dollar in the US has also played a role in the higher prices.

Unless we reduce our demand for oil or we find another BIG ASS supply (the US consumes about 20 million barrels of oil per day), the prices will remain high.

Read the entire New York Times article here.


plez sez: so much for the guaranteed oil that was going to help pay for the war in iraq. so much for having an "oil man" in the white house.

at four dollars a gallon, it will take close to $80 to fill up my suv. i'm kind of tall and don't want to have to by a Prius... i guess we're going to have to suck it up and steel ourselves against gasoline prices when they go over four dollars a gallon!

i had a blog post almost 2 years ago (April 2006) where plezWorld decried $3 per gallon gasoline. what i wouldn't give for $3 gasoline today!

labels: oil, gasoline, economy, opec, war in iraq, george bush,