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Buckle Up! Feds See $3.50 Gas by Spring

By Tom Doggett,
Reuters
Posted: 2008-01-08 16:57:43
WASHINGTON (Jan. 8) - U.S. consumers will pay record prices for gasoline this spring, with national monthly pump costs peaking near $3.50 per gallon when the busy driving season begins, the government's top energy forecasting agency said Tuesday.

A woman pumping gas
AP

Higher crude oil prices, which last week topped a record $100 a barrel, are pushing up motor fuel costs, the Energy Information Administration said in its new monthly forecast.

The price of crude oil now accounts for about two-thirds of the cost of making gasoline, according to the Energy Department's analytical arm.

Tight supplies caused by global oil demand growing faster than new oil production is behind higher petroleum costs. And consumers should not expect a break any time soon.

"Global oil markets will likely remain tight through 2008, then ease moderately in 2009," the EIA said. "Both motor gasoline and diesel prices are projected to average over $3 per gallon in 2008 and 2009, with monthly average gasoline prices peaking near $3.50 per gallon this spring."

The national price for gasoline jumped 5.6 cents over the last week alone and now stands at $3.11 a gallon, up 80 cents from a year ago.

High gasoline prices are cutting into consumer spending and raising business expenses, hurting a U.S. economy that is already suffering a slowdown.

The pain at the pump has also become an issue in this year's U.S. presidential election, with both Democratic and Republican candidates telling voters they know family budgets are being pinched and laying out their energy policies to tackle the problem.

U.S. gasoline use during the first half of this year will be higher than a year ago, but rising pump prices will reduce motor fuel demand growth by 20,000 barrels a day in the current quarter and by 10,000 barrels a day in the second quarter, the EIA said.

Copyright 2008 Reuters Limited. All rights reserved. Republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon. All active hyperlinks have been inserted by AOL.
2008-01-08 07:11:30
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Recent Comments

1 - 10 of 697
697 comments

FreeDr5 02:44:18 PM Feb 10 2008

It’s time for us to take a stand on these outrages fuel prices. The oil companies are making outrages profits on fuel. There is only one way to stop the rise and lower the price of gasoline, STOP BUYING GAS. Once a month on a Friday Saturday and Sunday if the whole nation went without buying gasoline we would have a huge surplus of fuel that the fuel prices would drop down to a price that we could enjoy again. Lets start this on April 4TH 5TH and 6th. May 2nd, 3rd ant 4th. Lets all make a strong and united statement to the oil companies that we have had enough!

Send to everyone you know, If they don’t have e-mail call them. Make a flyer to take to your local store to let everyone know.

Womanowner 05:13:37 PM Jan 11 2008

Gas is cheep get out and try pushing it

Ssdgeo 12:01:38 PM Jan 11 2008

gas is up 10.7 time over the last 50 years. Bread is u p about 50 times and meat is up abot 20 time s over the same period of time.

CorrieC 06:06:00 AM Jan 11 2008

Hey Ciolajr, we don't live in other countries. The one who can fix this is Ron Paul, but he isn't a superstar like the other candidates and he makes congress mad-a good thing. The gas companies clearly have a monopoly and can make prices whatever they want them to be, that is why the profits are so high-they aren't regulated like all the other industries other than by their bank accounts. We need to throw the greenies out and drill!!

ORIN OK 05:22:47 AM Jan 11 2008

As long as most US Citizens demand a car that weighs 3500 pounds and will smoke the tires on acceleration we are going to have a motor fuel supply problem which equates to increasing prices. Decrease the weight of the vehicle, fuel mileage goes up. You can cruise down the highway at 70 mph on 25 HP but you need 200 HP to sqeal rubber.
I saw an interview with the CEO of Ford Motor Corp who said it best; "We have known for years how to make cars that get dramatically better fuel mileage but we can't force people to buy them."

Steves WB 03:54:00 AM Jan 11 2008

The US is sitting on 125 years worth of crude, but we're not allowed to drill. We let the tree huggers and greenies shut us down. We also haven't built a refinery in about 30 years (can you say out dated).

For those of you complaining about "big oil" and their profilts.... business is in business to MAKE MONEY!! If you don't like who is making the money START YOUR OWN BUSINESS.

HPulliam 03:08:12 AM Jan 11 2008

get bush (and his oil buddies) and the reps outta office, stop excessive govt spending (fed, state, and local) stop ceo from cashing in on big dollars, put a foot down on the insurance industry.

Turneycon77 12:51:49 AM Jan 11 2008

whats realy cool about my prototype is if you run out of gas you can always shit in the tank and go. hahahhahahahhaa whoooooooww laaaaaaaater

Turneycon77 12:49:34 AM Jan 11 2008

Ok so I have found that different dog food brands produce different grades of fuel alpo is like deisel, purena produces something like 89 octane when excremented from a caged dane, but imes that shit is racing fuel but the shit to fuel ratio is very low.

Turneycon77 12:43:41 AM Jan 11 2008

I have designed an engine that runs on dog shit, we can farm grate danes and harvest all the fuel we need with a fricken shuveling machine. See than we liquify it and add some perfume where we ship it in super shit tankers, and distribute it at shit stations.

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697 comments

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