July 14, 2006
With the continuing troubles in Israel and Lebanon, oil prices have soared, but how long is it going to take until those barrel prices lead to some pain at the pump?
Central Virginia hasn't seen much change in gas prices since the conflict in the Middle East began several days ago. One gas station at Mill Creek offers regular grade gas at $2.78 for quite some time. However, some experts say that may be changing.
Amidst the escalating violence in the Middle East, the barrel price of crude oil soared to a record highs on Wall Street today, closing the week at over $77 a barrel. Some energy experts say it will not take long for that oil price to be passed down to the consumer.
"Gas stations across the country have a shown pretty quick turnaround time in having the price of oil reflected in the gasoline price," said Rahim.
Experts say for every dollar per barrel crude oil rises, people at the pump pay another nickel. With barrel prices rising more than $5 in the past three months, we could be heading for a serious situation.
"This could make the oil embargo of the 70s look like a walk in the park," said Phil Flynn.
According to AAA, Charlottesville is averaging $2.78 a gallon. This is 55 cents more than the same time last year. But some analysts think it could take prices double this to change American driving habits.
"Cars and gas are so much a part of our life that I would imagine that gas prices probably have to go over $5 a gallon before anything even can begin to change," said consumer Mary Ann McGrath.
Other factors could also lead to a spike in crude oil prices. Any type of natural disaster such as a hurricane that disrupts the flow of oil would lead to a potential spike in gas prices. A spike that we as consumers will eventually pay for at the pump. Right now, the national average price of regular gas is $2.96 a gallon.