Energy crisis jitters hit as gasoline costs approach record high

The steady increase in gasoline prices, which are nearing record highs, has begun distant rumblings and rumors of looming energy crisis. Gasoline costs have been rising nationwide for weeks. The effects have reverberated throughout numerous industries, and households are feeling the pinch. The rise in price is not going to likely subside, either.

Price of gasoline easily rises 20 cents

There was a 20 cent increase in gasoline in only a week alone. Between March 18 and April 8, gas went from $3.57 to $3.76 nationwide according to Reuters. A single dollar increase in gasoline has happened over the past year. The current record for gas costs in the U.S. was set in July of 2008, at $4.11 per gallon. Currently, large cities in the U.S. are averaging more than that. On April 8, California alone reached a statewide high of about $4.14 according to CBS.

This is really hurting airlines

CNN has reported that jet fuel is increasing as well and air travel is impacted. Jet fuel costs go up with the price of petroleum, which recently climbed to $112 per barrel. The record was in 2008, when the cost of oil hit $150 per barrel and airlines took an enormous hit to their bottom lines. Shares of major airlines have started to fall on stock markets due to the increasing cost of oil. On April 8 stock costs for several airlines had dropped; Jet Blue by five percent, UnitedContinental by seven percent, and Delta by four percent. Costs of oil and gasoline are not likely to decrease, as analysts don’t believe that unrest in the Middle East is subsiding. Airline tickets will only continue to go up as the cost of gasoline continues to go up in tandem.

Consumers are figuring out how to cope

There are already signs of consumers not wanting to grin and bear greater costs of a gallon of gas. Charge card companies, according to Daily Finance, have noted falling gas sales for the past five weeks, and 70 percent of the nation’s gasoline station chains have noticed the same. More economic vehicles have aided in this decrease of sales at gas stations. According to USA Today, hybrid cars sales this year alone have increased by 37 percent. The increase in price is leading to lower demand, as fewer people are willing to pay the increased cost of fuel.

Citations

Reuters

reuters.com/article/2011/04/11/us-energy-gasoline-retail-idUSTRE73929V20110411

CBS News

cbsnews.com/stories/2011/04/10/eveningnews/main20052599.shtml

CNN

money.cnn.com/2011/04/08/news/economy/American_Airlines_fuel_crisis/index.htm

Daily Finance

dailyfinance.com/story/drivers-hit-the-brakes-as-gas-prices-rise/19908875/

USA Today

usatoday.com/money/autos/2011-04-06-prius-tops-one-million-in-sales.htm