Gasoline prices today continued their push toward $3 per gallon. The only question now is when?
Prices have been jumping on the back of a strong oil market where the cost for a barrel has spiked 20 percent in the past month on the New York Mercantile Exchange.
Skyrocketing gasoline prices couldn't come at a worse time for motorists, who will see heating bills jump after the worst cold spell in years.
Oil prices are now about three times what they were a year ago.
"There is a long history of tripled oil prices causing consternation among consumers," Peter Beutel of Cameron Hanover said in his report today. "We are not there, yet, but gasoline prices at more than $3.00 is certainly an unwelcome sign of consumer distress."
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Prices rose 1.4 cents overnight to $2.749 per gallon, according to auto club AAA, Wright Express and Oil Price Information Service. Prices have climbed 8.4 cents a gallon in the past week and are 95.5 cents higher than a year ago.
The government will release its weekly survey of retail gasoline prices later Monday.
Motorists are paying about $50 more a month for gasoline than a year ago, and the total fuel bill for Americans now tops $1 billion per day compared with $650 million per day last year. Add in heating oil and diesel fuel, and the total fuel bill is probably $400 million to $550 million more each day than a year ago, said Tom Kloza of the Oil Price Information Services.
Kloza said in an e-mail that he sees prices rising by another 5 or 10 cents a gallon for now, but that drivers will not pay $3 for gas until spring.
Crude prices continued their move higher today amid signs of strong Chinese demand for crude, a weakening U.S. dollar and a fresh flow of speculative funds into commodities.
Benchmark crude for February delivery rose 4 cents to $82.79 a barrel on the New York Mercantile Exchange. On Friday, the contract rose 9 cents to settle at $82.75.
China said Sunday that oil imports rose 14 percent last year to a record high in December, part of a 56 percent surge in overall imports last month.
Also boosting prices was a weaker dollar. Because crude is bought and sold in the U.S. currency, it becomes cheaper for anyone holding stronger currencies to buy crude.
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The euro rose to $1.4522 on Monday from $1.4430 on Friday.
In other Nymex trading in February contracts, heating oil fell less than a penny to $2.1924 a gallon while gasoline gained less than a cent to $2.1596 a gallon. Natural gas futures fell 27.4 cents to $5.475 per 1,000 cubic feet.
In London, Brent crude for February delivery fell 34 cents to $81.03 a barrel on the ICE Futures exchange.
