Gas Prices Keep Climbing, Highest Prices in Midwest
The New York Timesreports that gas prices have climbed 41 days straight to a new national average of $2.62. The AAA's Fuel Gauge Report has the national average at $2.62 - about $1.4 less than this time last year. Gas is highest right now in the Midwest where there are refinery problems.
Gas prices have risen 41 days in a row, to a national average of almost $2.62 a gallon. That is a sharp increase from the low of $1.62 a gallon that prevailed at the end of last year.
Refinery problems are producing especially high prices in the Midwest, a region that was already reeling from the economic crisis. Michigan, the state with the highest unemployment rate, at 12.9 percent, is now paying the highest gasoline prices, averaging $2.93 a gallon.
The national jump in prices, far larger than the normal seasonal increase, is pulling billions of dollars from the pockets of drivers. It threatens to curtail a modest recovery in consumer spending on items like apparel and electronics.
After increasing 62 percent since December, the price of gasoline is actually lagging behind the increase in the price of oil, which has doubled in the same period, to more than $68 in recent days.
Part of the increase is because of the seasonal spike that happens every time summer approaches and more drivers head off on long trips. Prices should start coming back down by the end of the summer. However, the high price of oil is not good for the economy. If it stays high or climbs higher than gas prices could return to the high $3 and $4 prices we saw over the past few years. This would certainly dampen consumer spending and cause inflation in prices for food and consumer goods.
