Gas Above $3.50, Oil Nears $120

The price of oil and gasoline continue to hit record highs with each passing day and, unfortunately, it doesn’t appear as if there is any possibility of relief in the near future.

Today, the price of a barrel of crude oil closed at nearly $120, while the price of a gallon of regular unleaded gasoline climbed over to over $3.53.

At this point last year, the national average price for a gallon of regular unleaded gasoline was at $2.86, or roughly 19% less than today’s average. Even last month, the national average price was “only” $3.25 a gallon, or roughly 8% less.

According to GasBuddy.com, New Jersey currently has the lowest state-wide average price for a gallon of regular unleaded gasoline at $3.33, while California is reporting the highest state-wide average price at nearly $3.88 a gallon. At this rate, it should only be a matter of days before we have the first $4 a gallon state-wide average gasoline price.

Obviously, this isn’t exactly the world’s greatest news, especially considering the current state of our economy. So, since may of us are trying to figure out where gas prices are going to go from here. According to many pundits, we will apparently avoid $4 gas this summer, however, I don’t buy it.

In order to try and prove this people wrong, I used some historical data and some simple logic to see if we will in fact avoid the dreaded $4 gas scenario. Essentially, I took a look at where we were at this point last year – $2.86 a gallon – and compared that number to where gas prices topped out last summer – $3.24 a gallon. In turn, by doing some simple math, I figured that gas prices jumped over 14% during that period.

Assuming the same were to happen this summer (and even this may be wishful thinking), we should expect gasoline prices to hit no less than $3.99 this summer.

I realize this is a very simplistic look at where prices may end up, but I think it does go to show that it’s not going to take much to get us to that $4 barrier. And considering we’ve never gotten back below the $2 barrier, we should probably come to the realization that, at the very least, $3 gas is here for good.

Regardless, all signs are clearly pointing to a very expensive summer vacation season, so hopefully you’ve been practicing your gas saving driving habits!

Comments

  1. Hahaha, I really like it when you Americans are this upset about these ‘high’ gasprices.
    I would love to pay 4 dollars per gallon!
    In Europe (yes, I live there) we pay about 1,50 euro’s per Liter!
    So, 1 gallon = 3,78 liters. And 1 dollar = 1,55 euro.
    That means we pay about 8,78 Dollar per gallon.
    I would love to see you guys paying that price!

  2. Haha ya…I wish here in Canada that i was paying $4.00 a gallon…..right now we are paying about$5.20. And yes I will say that too….I would love to see Americans reactions if they were paying $5.00 a Gallon.

  3. We have a lot further to drive than you.

    Another of the big differences between europeons and Americans….Americans Think 100 years is a long time, Europeans think a 100 miles is a long drive.

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