$5 Gas

March 1, 2012 by staff 

$5 Gas, Estimates for the price of gasoline this year range from the unfortunate to the devastating. Some experts predict drivers will pay $5 a gallon by summer, while others say it may not even hit $4.

“You may indeed have to pay $5 a gallon if you buy your summer gasoline on a tropical island, Martha’s Vineyard, or one of the tonier suburbs of New York, San Francisco or Los Angeles,” Tom Kloza, chief oilanlyst for the Oil Price Information Service, said in a recent blog.

Kloza said he stands by his prediction of prices peaking at $3.75 to $4.25 per gallon by spring. Certain “hot spots,” including New Jersey, might see somewhat higher prices, partly due to the recent closing of two East Coast refineries.

But demand for fuel was “abysmal” at the beginning of 2012, Kloza said. Gasoline sales were down 5 to 7 percent in the first 40 days of this year, compared to the same period in 2011.

The U.S. Energy Information Administration predicts gasoline will be $4 per gallon by April or May, based on the current price of Reformulated Blendstock for Oxygenate Blending, said Neil Gamson, an economist with the agency. That’s near the all-time record of $4.11.

Chris Lafakis, an energyanlyst with Moody’s Analytics in West Chester, Pa., said his company’s forecast is more optimistic.

“We predict the peak price will be somewhere between $3.80 and $3.85 (per gallon) nationally on Memorial Day weekend,” maybe a little lower in New Jersey, Lafakis said.

That’s barely above the U.S. average on Wednesday of $3.73 a gallon, as reported by AAA. The price is up 45 cents since Jan. 1.

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