Gas, oil prices set records
November 8, 2007
The simple action of going to the gas station and filling up a gas tank doesn’t always conjure images of global markets spinning out of control and complicated geopolitical relationships.
Or maybe, recently, it does.
Phil Avery, a seasonal hunter visiting from Sacramento, Calif., looks at the prices, hanging high from a roadside gas station sign in Craig, and thinks about all that.
“It sucks,” Avery said.
But Avery knows more than the average person may. For instance, he knows the current price for a barrel of oil is about $97, the highest in the history of the automobile.
The previous high was set last Friday, Nov. 2.
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“I know that, and it sucks,” Avery said.
Another record recently broken is the price for a gallon of regular unleaded gas this time of year.
In between Memorial Day and the holiday season at the end of the year is generally a time when gas prices drop, said Eric Escudero, AAA Colorado manager of public relations.
People typically don’t travel a lot during that time, so prices fall with the demand, he added.
“The scary thing about prices being so high this time of year, is that when the holidays come around, they’re most likely going to go even higher,” Escudero said, “because people will be traveling farther and that demand usually drives the prices up.”
The national average for regular unleaded is at $3.02 per gallon, compared to the all-time high of $3.22 set last year.
The average for Colorado gas stations is at $3.03 per gallon, compared to the $3.34 per gallon record set this past Memorial Day.
The current average is 15 cents more than a week ago, 22 cents more than a month ago and 82 cents more than a year ago, according to AAA.com.
After a Wednesday announcement from the Energy Information Association, a national group – which said U.S. oil supplies fell by 800,000 barrels last week – the price of crude oil finished the day at $97.65.
This is the fourth time in U.S. history the national average for a gallon of regular unleaded gas has been above $3 a gallon.
“There’s a lot of different opinions why,” Escudero said. “The only certain thing is that prices are directly related to the rising cost of oil.”
The price of crude has risen from less than $80 to almost $100 in less than a month.
Energy analysts blame a lot of the price surging on floods in the southern Mexico state of Tabasco. Oil company Pemex has many of its oil fields there and has not produced at capacity.
Mexico is the second largest source of imported U.S. oil behind Canada, according to AAA.com.
Compared to gas prices during the oil embargo of the late 1970s and early 1980s and adjusting for inflation, prices now are at that level or higher, according to analysts, Escudero said.
“People might go to gas pumps and think, ‘Oh, I’m not surprised. Gas is always high,'” Escudero said. “But this is really something that has never happened before.
“The only certainty is gas prices right now is the uncertainty.”