"Yikes! I Might Be...Militia!"
If experts in the oil and gas and financial services industries are on target, Americans should expect to see fuel costs rise during the remainder of 2009. In particular, they should expect to see gas prices approaching $5 per gallon by 2010.
Chart shows today's gas prices courtesy GasBuddy.com
Among the driving forces responsible for the price increases is the rising cost of manufacturing crude oil and, in turn, gasoline, according to John Felmy, chief economist for the American Petroleum Institute.
During a conference call this morning, Felmy told bloggers and journalists that, during the past eight weeks, the cost of manufacturing crude had increased by 64 cents per gallon and the cost for producing gasoline has jumped 61 cents per gallon. He added that the recent annual introduction of summer gasoline formulations, which are slightly more expensive, also contributed to the pump price as has a reduction in output by OPEC.
Felmy’s prediction dovetails with one offered 11 days ago by the folks at Goldman Sachs. The financial services giant predicted that the price of a barrel of crude oil — which is equal to 42 gallons — will jump to $85 by the end of the year and push up to $95 by 2010.
At the time of the Goldman Sachs prediction, it equated to a whopping 31 percent increase. Translated into at-the-pump gasoline costs, Americans should expect to pay well in excess of $3 for a gallon of regular gasoline within six months.
In South Carolina, the state with today’s lowest average gasoline price in the nation at $2.444 per gallon, according to GasBuddy.com, that increase will translate to a price of about $3.20 per gallon by January. Everywhere else, prices should soar higher.
In Los Angeles, for instance, prices are already as high as $3.37 per gallon. If the predictions pan out, consumers in Southern California should expect to pay as much as $4.41 or higher.
Final note: With unemployment increasing, more and more Americans are likely to find themselves in need of Will work for fuel t-shirts.
4 responses so far ↓
1 » Gasoline Prices to Approach $5 Per Gallon by 2010! NoisyRoom.net: “Extremism in the defense of liberty is no vice. Moderation in the face of tyranny is no virtue.” Barry Goldwater // Jun 15, 2009 at 9:24 am
[...] By: Bob McCarty Bob McCarty Writes [...]
2 Clay // Jun 15, 2009 at 1:32 pm
I think this sounds conservative. I bet it’s going to be higher than $5 on the account the government is looking to tax everything again and again. If they don’t increase taxes on gas, they will find another way to tax your driving.
3 Change we can believe in - Gas prices may hit $5 by 2010 | The Lonely Conservative // Jun 15, 2009 at 4:31 pm
[...] said he would like to see gas prices increase to decrease demand for the product. It looks like his wish may come true. If experts in the oil and gas and financial services industries are on target, Americans should [...]
4 Trialdog // Jun 17, 2009 at 8:25 pm
The administration, of course, wants gas at five dollars or more. It will certainly happen. The problem may be that the administration wanted to control the price through oppressive taxes. Those taxes may not be possible. With other administration policies weakening the dollar, the abandonment of domestic production, and our foreign non-policy, it isn’t going to be direct taxation on gas that drives the price up and out of control. When it happens, and it will, the administration will do what it does best; something completely destructive and nearly irreversible. Impose massive “windfall” taxes on the oil companies then “bail” them out. More government seizure of private business. No worries though. This is what the people voted for. This is what they wanted.
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