The recent Lundberg Survey shows that the US average retail gasoline price has again hit a new record high.
$2.33 a gallon!
The record price is up nearly ten cents from two weeks earlier.
Let me put that in perspective for you. If gasoline prices were to continue to rise ten cents every two weeks, the national average would be $3.63 by the end of 2005!
Trilby Lundberg, who publishes the semimonthly Lundberg Survey of 7,000 gas stations around the country, determined the $2.33/gallon figure based on numbers compiled on Friday.
Also according to the survey, mid-grade averaged $2.40, with premium-grade slapping us in the face at $2.50.
The highest price for unleaded regular was in San Diego at $2.55 a gallon, while the best deal was in Charleston, SC at $2.09 a gallon.
If you’re a long time Wealth Daily reader, these numbers probably don’t surprise you.
We’ve been telling you prices such as these were inevitable because oil production is reaching its limit. So supply is tapering off right as demand is rising at record levels.
Previously we’ve been calling it the "coming energy crisis." But the crisis is no longer "coming." It’s here now.
The intensifying cost of crude oil and strong demand in the midst of the summer vacation season have pushed recent gasoline prices over the top. But the worst is yet to come.
Despite the jump in prices, demand for gasoline was up 2.5 percent compared to last June.
Gasoline prices may get worse during the next few months.
August gasoline futures got as high as $1.86 on Friday.
Gasoline prices may easily reach $3 by the end of the year and $5 by the end of the decade.
The possibility that gasoline prices will reach as high as $5 a gallon is a tough pill for all of us to swallow.
But the question remains, at what price will economy force consumers to begin to seriously consider conservation?
The skyrocketing fuel price in the last couple of years has forced people to drive less to conserve gasoline, including myself. Recently I have moved for no other reason that to be closer to the office.
Experts all agreed that driving a fuel-efficient car is the best way to save money on gasoline. Drive a four-cylinder car, instead of a six-cylinder.
For some consumers, driving a hybrid car is a solution. In the near future hybrid cars may become the standard.
However it will take consumers some time to get used to hybrid cars. Americans like power.
I believe one of the biggest holdbacks to the hybrid car market is the Honda Insight, which, in this writers opinion, is the ugliest car on the road.
While the Insight may be hideous, the fuel efficiency is beautiful. The Insight gets an impressive 70 mpg highway and 61mpg city.
But Honda seriously needs to consider making a better-looking car before many consumers, including myself, will consider the conversion.
Of course, another problem with the hybrids is the lack of power. Americans love horsepower, and big vehicles. It’s going to take oil prices well above their current levels to bring the masses to seriously consider hybrids.
But the day is coming. And hybrids, as well as their future counterparts, can certainly be considered a growth industry in themselves.
– Luke Burgess