Gas Prices Hit All-Time High -- Will They Get Higher?

Gasoline prices hit an all-time high of $3.10 as of May 14, 2007, increasing 10.2 cents to $2.97 per gallon. National average prices are 15.6 cents per gallon higher than at this time last year, according to this week's report from the Energy Information Administration (EIA). The reasons include continued high demand (1% greater than this time last year), refinery outages and lower import levels. The last 12 weeks have seen the fastest decline in gasoline inventories in the EIA's history. (Source: EIA This Week in Petroleum)

The EIA assures us that the higher gasoline prices have encouraged more production and imports. However, they don't think prices will fall below $3 a gallon all summer, and could even rise if demand surges, as it usually does, in late July and August. lt looks like drivers have gotten over their sticker shock, and will just keep driving this summer, despite the higher price. This does not bode well for energy conservation, inflation, or the trade deficit.

What It Means to You

Last summer we were all hoping that $3.00 a gallon gasoline was just a one time thing. Now we realize that this is how it is going to be. Think about reducing your own need for gasoline. Instead of going on a long driving vacation this summer, are there places closer to home that you've never visited?

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