Gasoline Prices Continue to Rise

By Linda Orlando

Anyone who drives a car knows that the national average price for gasoline has been steadily rising for the past few weeks. Gasoline prices have risen more than 10% over the last month. Industry analyst Trilby Lundberg, in her published Lundberg Report, says that the average retail price for all grades of gasoline have increased almost 13 cents in the past two weeks, with the most popular grade—self-serve regular unleaded—being priced at $2.10 a gallon on average around the country. The national motor club AAA, which uses a different analysis method, says the average price is $2.07. But the price of gasoline depends largely on where you live. Although the average in the Washington, D.C. area has hit a new high of $2.10 a gallon, a Union 76 station in Malibu, CA, is charging $3.05 a gallon for regular unleaded self-service, and $3.38 a gallon to have an attendant pump supreme unleaded. Even with these high prices, the station is doing a brisk business.

Gasoline has now reached an average price of $2 per gallon in 42 states and the nation’s capital, yet the demand for fuel continues to rise. The Department of Energy says that motorists are using about 2% more gasoline than they were one year ago. In that same period, prices for a gallon of unleaded regular gasoline have increased by about 21%. One gas station in Baltimore has become so tired of having to change their sign so frequently that they finally gave up and posted an all-purpose price sign last week. The owners of the station at the corner of Seminary Avenue and York Road instead decided to display the prices as "arm" and "leg" rather than using the standard price figures on their marquis. The station probably hopes to let consumers know that they sympathize, and that they aren’t the ones to blame for the continually escalating prices. For those who would prefer not to give up a body part in exchange for a fill-up, the station also accepts cash for gasoline purchases, as long as you’re willing to pay $2.15 a gallon for it.

Lundberg says that retail prices have begun to catch up with soaring crude oil prices in recent weeks. She adds that because of strong demand and supply problems caused by the transition to cleaner-burning gasoline mixtures, prices should continue to rise in the weeks ahead as summer approaches. But officials say that solid economic growth is beginning to soften the blow. Trucking executives say that although diesel fuel prices have risen 34% in the past 12 months, customers are not complaining about higher fuel surcharges. However, airlines are continuing to lose millions because jet fuel prices are up a whopping 65% from just one year ago. In an effort to salvage their business, airlines are engaging in intense competition, with fare cuts of up to 15% for many carriers on flights among the nation’s 100 busiest air routes. So if the high cost of gasoline has caused you to think twice about that cross-country RV vacation this summer, perhaps you might want to consider flying cross-country instead. Between lower airfares and not having to pay premium prices for gasoline, the money you’ll save might help pay for an extra couple of days at an upscale hotel or resort.