WORLD> America
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WORLD> America
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Gas hits record $4 in America
(Agencies)
Updated: 2008-06-09 19:25 Yolanda Cade, managing director of public relations at AAA, said gas prices are likely to rise further, although the automotive club is waiting to see where oil prices head this week before making any new predictions. "We've cautioned gasoline station owners against not recklessly increasing retail prices just because of one big jump in the crude market," she said Sunday. "One day of trading doesn't constitute a market trend." A number of factors are behind oil's ascent. Soaring demand in Asia and elsewhere is ensuring global supplies remain tight even as Americans cut back; recent figures from the U.S. Energy Department's Energy Information Administration showed U.S. gasoline demand actually fell 1.4 percent over the last four weeks. A tumbling dollar is also contributing to the increase. Many traders buy commodities such as oil as a hedge against inflation when the dollar is falling, and a weaker dollar makes oil cheaper for investors dealing in other currencies. The rapid increase has also enticed speculators, frustrated by low returns elsewhere, looking to make a quick profit. The influx of so much fresh money into energy markets has caught the attention of federal watchdogs. The U.S. Commodity Futures Trading Commission recently said it has begun a probe of U.S. oil markets focused on possible price manipulation. For many drivers, the higher gas prices mean rethinking everyday habits. Some are reining in gas consumption, either by cutting back on all but the most essential driving or looking anew at alternatives like public transportation. Sales of gas-guzzling vans and sport utility vehicles are down, while those of fuel-efficient compacts and hybrids are on the rise. Others are getting creative. Take Robert Torrey of Connecticut, the state tied with Alaska as the second most expensive for gas. After leaving work in the town of Windsor Locks last week, he drove across the border into Massachusetts to fill up his van with $100 worth of gas. He figures he's saving about $10 per fill-up by traveling the 18 miles north. "I let it run all the way down to the bottom before I get here," said Torrey, while pumping gas at the Pride station off I-91 in Springfield, Mass. "I try to combine it with other trips while I'm up here, so that makes it worth the drive." |
