Gas prices up 80 percent is a disaster

So why are gas prices so high?   

Gas prices jump, but increases could level off.  By JOHN WILEN 

NEW YORK (AP) — Gasoline prices shot up to yet another record at the pump Thursday, while some analysts said the sharp price increases of recent days could soon level off even though gas will continue to rise.

Crude oil prices, meanwhile, stalled in their march toward $120 a barrel, dropping sharply as the dollar gained strength against the euro.

At the pump, the average national price of a gallon of regular gas jumped 2.3 cents overnight to $3.556 a gallon, according to a survey of stations by AAA and the Oil Price Information Service. Prices have risen nearly 14 cents in one week.

Gas prices have risen sharply in recent days partly because refiners have been switching over from selling winter grade gasoline to the more expensive but less polluting form of the fuel the government requires them to sell in the summer. That process, which made winter grade fuel more scarce, is nearly complete now, suggesting that price increases could slow.

"That was probably why ... you saw (prices) accelerate so quickly," said Tom Kloza, publisher and chief oil analyst at the Oil Price Information Service in Wall, N.J. "No, don't get used to these crazy increases."

Retail gas prices have also been following oil futures' record rally, although prices hasn't risen as steeply as oil futures.

"(Gas prices) had a lot of catching up to do," said James Cordier, president of Tampa, Fla., trading firms Liberty Trading Group and OptionSellers.com.

Crude prices have jumped about 80 percent in one year, while retail gas prices are only up 24 percent in that time.

But Thursday, light, sweet crude for June delivery fell $2.54 to $115.76 a barrel on the New York Mercantile Exchange Thursday as the dollar rose against the euro. Investors see commodities such as oil as a less effective hedge against inflation when the dollar strengthens, and a stronger greenback makes oil more expensive to investors overseas.

...In the new world order, energy scarcity will dominate our lives -- determining when we drive, if we travel, and what we eat.

By Michael T. Klare

"This new world order will be characterized by fierce international competition for dwindling stocks of oil, natural gas, coal and uranium, as well as by a tidal shift in power and wealth from energy-deficit states like China, Japan and the United States to energy-surplus states like Russia, Saudi Arabia and Venezuela. In the process, the lives of everyone will be affected in one way or another -- with poor and middle-class consumers in the energy-deficit states experiencing the harshest effects. That's most of us and our children, in case you hadn't quite taken it in."