Posted on 04/06/2008 11:05:38 AM PDT by kellynla
NEW YORK — Retail gas prices surged to another milestone, rising above $3.30 a gallon Friday, and appear poised to rise further in coming weeks as supplies tighten.
Oil prices, meanwhile, supported the gas price rally by jumping more than $2 a barrel after a dismal employment report sent the dollar lower.
At the pump, gas prices rose 1.4 cents overnight to a national average of $3.303 a gallon, according to AAA and the Oil Price Information Service. That's the latest in a series of records, and about 60 cents higher than a year ago.
In Ventura County, the average price of regular unleaded hit a record $3.68 a gallon Friday, according to the Automobile Club of Southern California.
During the past week, prices in the county have been climbing by a few cents per day.
A few weeks ago, Jack Kyser, chief economist of the Los Angeles County Economic Development Corp., said he expected prices to fall as oil speculators backed off.
Now, he's not so sure.
"We could very likely see $4," he said. "It's going to be painful."
As investors are fleeing to commodities such as oil, gold, wheat and corn, people are starting to look at Washington, D.C., to curb speculation, Kyser said.
"You have speculators globally now," Kyser said.
"This is going to be a tough time for anybody who has to use an oil-based product. We've already seen chaos in the aviation industry, with Aloha and ATA going out of business."
While oil's surge above $100 over the past month has boosted gas prices so far this year, analysts now expect gas prices to continue rising regardless of what direction crude takes. The Energy Department expects prices to peak near $3.50 a gallon later in the spring, but many analysts predict that the spike could approach $4.
That's because gasoline supplies are falling, in part because producers are cutting back on output of the fuel because of the high cost of crude — the more expensive crude is, the more refiners have to pay and the lower their profits are.
They're also in the process of switching from producing winter grades of gasoline to the less polluting but more expensive grade of fuel required in the summer.
"That cuts back on some of the supply and helps to pump up the price," said Mike Pina, spokesman for AAA.
The margin between the price that refiners pay for crude and receive for selling the products they make from it is about $11 to $12 a barrel right now, according to the Oil Price Information Service.
However, that margin has occasionally slipped into negative territory in recent weeks and is well below margins of $37 a barrel that refiners earned last spring.
In futures trading, meanwhile, oil futures rose Friday after the Labor Department said employers cut payrolls by 80,000 jobs last month, much more than analysts had expected.
The unemployment rate rose to 5.1 percent.
That news sent the dollar lower and pushed light, sweet crude for May delivery up $2.40 to settle at $106.23 a barrel on the New York Mercantile Exchange.
Gasoline futures for May delivery rose 3.24 cents to settle at $2.7567 a gallon.
Gasoline futures were also boosted Friday by a fire that shut down part of a refinery in Torrance.
First off what part of my position is environmentalist??? It is a fact that fully a 1/3 of the run up of the cost of crude oil is directly tied to the drop in the value of our dollar. If you can’t see that our dollar is being dumped then you are a blind idiot. The oil execs told congress themselves, that they think that up to 1/2 of the run up of the cost of crude oil is due to speculation in the oil futures commodities markets. I guess they are environmentalist too. You are an idiot. Marxist delusions???? You haven’t the first clue what that even means. You’re a pair of clown shoes.
Yeah...sheet happens.
Careful if you rock the boat, you're apt to be called a deluded marxist. The company memo is that the ONLY reason that oil could possible be trading where it's at is due to us not drilling for oil in Alaska. Which is funny since California produces more oil than Alaska. Texas produces way more than Alaska. And they are developing an oil field in North Dakota that dwarves ANWR called the Bakken Formation. Hopefully that will be developed. None of it though will bring us back to $1.50 gas.
IMHO, it would be 'nice' if our 'leadership' even knew about the costs at the pumps
What leadership?
Once you get addicted to record profits quarter after quarter, it’s like a drug. And if you can bribe 51% of the government and your president holds hands with the head of Saudi Arabia, you can keep going, I guess forever.
Watch the idiot Democrats pass more laws to restrict drilling for oil and gas in the U.S. and at the same time call in oil company executives to blame them for rising prices.
I bet the stations all have cameras...against vandalism, but??
Environmentalists AND people who drive big 10mpg SUVs are both part of the problem. Even if gas was back down to $1.50 you are still sending a crap ton of money to countries that hate us by driving that inefficiently. If either one of those would go away (Environmentalists / Large # of huge [no problem with smaller] SUV drivers), gas would go back and stay at near $2 a gallon. If both went away, we could possibly see $1-$1.25/gallon again.
Declining dollar is one of the lesser factors involved. Even removing the weak dollar, oil went from $9 to $70/barrel in less than a decade. The biggest factors are huge increase in demand in China/India, burdensome regulations, and no drilling allowed in the US.
Definately a bubble in commodities but even when it pops I don’t think oil will drop below $70/barrel again anytime soon which means gas is staying near $3/gallon regardless.
OPEC, crime syndicates, governments, are not just names. There is always a "they" my friend.
NYMEX in the green...
Brilliant.
This could be the biggest nation wide freep of all.
Now I understand why Bill Gates is a democrat, it is because he gets to keep a 1/3 of his money now.
At what price will the majority of the single female and union thug democrats demand that we drill for more oil. Most Dems are not totally retarded regarding everything, just quite a few things.
But the idiots believe it's because of excess oil company profits. If that's the case, buy oil stocks.
Buying oil stocks is for suckers - the real money is in government, which siphoned $105 billion off of Exxon-Mobil worldwide last year.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.