It has risen faster than a speeding bullet and hit wallets more powerful than a locomotive. It’s not a bird, it’s not a plane, it’s the average cost for gas in America.
Gas prices hit a record high for this time of year at $3.758 per gallon. This time last year, the price for gas was about 25 cents cheaper nationally.
Utah is currently ranked fourth for lowest gas prices. According to Gasbuddy.com, Utah’s average cost for a gallon of unleaded gas is $3.522. However, the spike in prices has hurt local gas stations. Jeff Wade, owner of Mountainland One Stop in Heber City, independently owns his gas station. At the time of the interview gas cost $3.49 per gallon at his station. As a result, his profits have dropped.
“The biggest thing is that it slows all of our inside sales down,” Wade said. “People can’t afford to buy other things when they have to pay more for gas.”
Inside sales of soda, chips and other treats bring in the most profit at gas stations. Wade said gas sales bring in about one percent profit in comparison to the 30 percent from inside sales.
Wade said the gas price spike results from speculation. Investors in Gas Futures speculate on future oil prices and use these predictions as a base for gas prices. These speculations are based on events like global economy and Middle East stability. This differs from a supply-demand model. According to the U.S. Energy Information Administration, gas demand is lower than this time last year. Wade said prices should be lower as a result.
Matt Skryja, Senior Spokesperson for AAA NCNU Insurance Exchange, said the improving economic condition has also been driving the prices up.
“When there’s good economic news, the prices go up,” Skryja said. “When there’s bad economic news, the prices go down.”
Until they drop, some students altered their schedules and habits to accommodate. Bridgette Floyd, a senior from Corona, Calif., studying sociocultural anthropology, spends more time on campus to avoid using her car more than necessary.
“I have to wait on campus an extra five hours every Tuesday and Thursday to drive home with my roommate,” Floyd said, “instead of just going back to pick her up.”
Floyd said she also combines errands and cuts down on trips to the grocery store.
Jose Martinez, a sophomore from Dallas, studying political science, never travels far out of Utah County. However, he said he’s looking for alternative transportation.
“I do plan on buying a bike to ride to school and only using the car for necessities,” Martinez said.
Economists and oil experts predicted in January 2011 gas costs of $5 per gallon by this summer. Skryja said he doubts this will happen.
“At this point, it’s too early to talk about it’s to early to talk about five dollars per gallon,” Skryja said. “AAA analysts really don’t expect it to get that high.”