Gas Prices Continue Record Climb

Nationwide gasoline prices continue to increase. The rising average for regular is $4.02 a gallon, as crude oil prices fell only slightly after last Friday’s record surge. The price of gasoline is now 93 cents a gallon more than it was a year ago. Gasoline prices of diesel this morning were at $4.77 a gallon, $1.87 more than this time last year. Economists fear this steady rise in gasoline prices eating at consumers’ money, who already have an economy that is weighted down by concerns about housing prices and the stability of financial institutions. With this increase in the price of gasoline, consumers have started to trim down the amount of driving they do. MasterCard has recently reported that a 4%-5$ decline in the purchase of gasoline, but the Energy Department’s Energy Information Administration has been reporting more modest declines. Prices of gasoline futures were down substantially today on fears that demand for U.S. motor fuel would drop more steeply now that prices have crossed the $4 threshold. Despite this, international supply and demand forces have driven crude oil prices up despite the declines in the United States. The US is still the world’s largest oil consumer, and crude oil costs make up the majority of gasoline costs. There are many disagreements over who is primarily to blame with leading figures in the oil industry.

The 1917 oil crisis began on October 17, 1973, when the members of Organization of Arab Petroleum Exporting Countries (OAPEC) announced that they would no longer ship oil to nations that had supported Israel in its conflict with Syria and Egypt. The United States was one of the countries who supported Israel, so they were greatly affected by this refusal to ship oil.

http://www.washingtonpost.com/wp-dyn/content/article/2008/06/08/AR2008060800574.
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