Gas Prices Still Could Rise
By Daniel Carson, The News Herald, Panama City, Fla.
Jan. 5–Traditionally, January is not a peak time for gas prices, said AAA South spokesman Gregg Laskoski.
But historically high oil prices that eclipsed $100 per barrel this week, coupled with a weak U.S. dollar, radically changed the traditional pricing landscape.
“It means consumers are paying a premium at the pump,” Laskoski said Thursday.
The highest recorded Florida average price for regular unleaded fuel was $3.156 on Nov. 15, according to AAA’s Daily Fuel Gauge Report.
Although he did not know whether gas prices would exceed previous highs right away, Laskoski said he thought those prices would move higher in February.
AAA’s Daily Fuel Gauge Report listed Florida’s average price for regular unleaded gasoline at $3.13 per gallon Friday, up nearly 80 cents from the same time in January 2007.
Laskoski said that in previous years, gas prices tended to follow consistent seasonal patterns, usually falling in November, December and January before rising again in the spring to peak levels in May and June.
“But they’re going up from an already high level that we’re at in January,” Laskoski said.
Gas prices, meanwhile, jumped Friday to a national average of $3.074 a gallon, according to AAA and the Oil Price Information Service.
Gas prices have risen in recent weeks, following oil’s rise into record territory. Tom Kloza, publisher and chief oil analyst at the Oil Price Information Service, said gas prices likely are to add another 5 cents over the next week or so, but then likely will slide as demand ebbs this month and February.
The Energy Information Administration on Thursday reported that gasoline demand rose a tepid 0.1 percent over the last four weeks. But in the spring, when demand picks up and refiners start cranking out gasoline to meet expected strong summer driving demand, gas prices likely will rebound and could set new records. The EIA predicts gas prices will peak over $3.40 a gallon this spring, well above the record price of $3.227 set last May.
A big factor in the price increase: the price of oil. Light sweet crude oil for February delivery dropped $1.27, to $97.91 a barrel, Friday on the New York Mercantile Exchange. Crude oil is bought and sold internationally with the U.S. dollar as the primary currency, Laskoski said.
He said that meant Europeans, and to a lesser extent Canadians, were getting more fuel for their money at the pump.
“Conversely, U.S. consumers are finding their dollar is buying less gas than it was,” Laskoski said.
Colder weather in the Northeast could also affect gas prices, Laskoski said, with heating oil demand putting more pressure on domestic refineries.
Ultimately, prices could go high enough to diminish consumer demand, he added.
The Associated Press contributed to this report.
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