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Cenla motorists see prices rise after short relief in gasoline costs

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Written by

Written by
Jeff Matthews

Source: TownTalk.com

 

 

The break Central Louisiana motorists have been enjoying at the gas pump appears to be over.

Petroleum prices shot up in the Alexandria-Pineville area this week, in some cases by as much as 20 to 30 cents a gallon for regular unleaded, as local residents began to feel the impact of spiking oil prices on their wallets.

“It’s nationwide,” said Don Redman, spokesman for AAA in Louisiana. “It looked at one point like we were going to get a tremendous break heading into November, but as usual the events of the day reversed all the gains we’ve seen.”

Starting Monday and continuing Tuesday and Wednesday, local stations started raising their prices. Stations that had been selling regular unleaded for $3.05 to $3.19 per gallon had gone up to $3.17 to $3.35 by Wednesday.

Motorists flocked to locations that still had relatively low prices. Lines were three to four cars deep Tuesday night at Kroger on Jackson Street Extension in Alexandria, which was selling regular unleaded at $2.98. Lines were still long there Wednesday afternoon even though the price rose to $3.10 per gallon.

“I have to get it while I can,” said Mycha Lee, who was filling up at Kroger on Wednesday. “You never know what’s going to happen, so you get it while you can. I don’t know, it could be $3.50 (per gallon) in a week. It could be $4.”

On Wednesday, the average price for regular unleaded in Louisiana was $3.255 per gallon, up 3 cents from the day before, according to AAA’s Daily Fuel Gauge Report (http://fuelgaugereport.aaa.com).

Nationally, the average price on Wednesday was $3.405.

The main force driving the recent increase in prices is an uptick in oil prices. Crude went from selling for about $78 a barrel last week to nearly $86 Wednesday.

Investors have been banking on oil prices going up because an economic recovery in Europe would weaken the U.S. dollar and a recently released jobs report in the U.S. was rosier than expected. A weaker dollar normally drives up oil prices.

Redman said tension between major oil producers Iran and Saudi Arabia could be “an underlying factor” in oil prices. U.S. intelligence recently released details of a purported plot backed by Iran to assassinate a Saudi Arabian diplomat in Washington.

The trend upward goes against an Energy Information Administration report that fuel demand in the U.S. is down 2 percent to 2.5 percent from a year ago.

In fact, Redman said, some economists argue that based on supply and demand, crude should be selling for $50 to $70 a barrel, far less than its current price.

“But investors think otherwise,” Redman said. “They’re putting their money on it. … It has been a volatile market this entire year. It always has been, but this year seems much more so than other years.”

Indeed, this is not the first wild swing in fuel prices in 2011.

In May, many analysts were projecting gas would be selling for more than $4 a gallon in the summer. In Louisiana, prices rose as high as $3.85 in May before the bubble burst later that month and prices unexpectedly dropped.

Unfortunately, many experts now are predicting oil prices will not be dropping back down soon.

“We anticipate in the short term at least that these prices are going to rise,” Redman said.

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Written by demon53

October 13, 2011 at 2:10 pm

Posted in Uncategorized

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