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Surging Gas Prices Fuel Most Expensive Year

Surging Gas Prices Fuel Most Expensive Year Click to Enlarge Photo:

Aug 16, 2012 at 8:58 am

ST. CLOUD, MN (KNSI) - It's been a horrible six weeks for drivers nationwide with surging crude oil costs and refinery woes and likely making 2012 the costliest year ever at the pump.  

Experts are warning consumers to brace for another possible increase Thursday that is if prices aren't already up at your neighborhood gas station.

"The dealer's costs are up already and with the high pitched level of greed in the oil business today, we don't even have sometimes an hour's notice when the price changes," Jim Feneis with First Fuel Bank said.  "If a person happens to have their TV set on and watching CNBC, you see that price up more than a couple cents in the morning, you know that your friendly neighborhood dealer has probably already been dealt that increase."

U.S. crude oil prices settled at a three-month high Wednesday after a weekly report from the Energy Information Administration showed U.S. crude stockpiles declined last week.  The price of a barrel of oil went up nearly a dollar. Feneis said that action should be a warning to hold on to your wallet for what could be a bumpy ride.

"When we know that the wholesale passed up the retail, and you know that all the guys are underwater, they're licking their wounds heavy this afternoon so that fever will break. Now could I be off a quarter of a day, a half of a day, sure, but there is a 20 to 30% pound coming," Feneis said.

Prices Wednesday around St. Cloud were hovering near $3.60 a gallon. Nationally, gas prices are around $3.70 a gallon, up nearly 30 cents since mid-July. The nine percent climb lifted 2012's average for the year to $3.61, already ten cents more than last year, the most expensive year ever for motorists. 

In the short term Feneis believes drivers just have to hang on until the end of the month for a bit of a break.

"We're going out of a travel season, yes you're going to have some short term spikes, but I think that gasoline will settle down after the kids go back to school, travel season and people hunker in for the fall and winter," Feneis said.

The late summer spike is all part of a bad break for drivers after some industry experts thought we might see 3-dollar-per-gallon gasoline by autumn.  Between surging crude prices and Midwest refinery issues, that didn't happen. Feneis is among those in the industry who feel a big hit is coming, and sooner than anyone would hope.

"We're in right now a 1 dollar trading range, and you're going to see the low threes to the high threes. Can we blast to 4 and 5 dollars?...I hate to report this but we are going to live to see 2 dollars and we are going to see 6 dollars," Feneis said.

JW Cox

Posted By JW Cox

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