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Pump pain returns

Posted at 2:21 PM on February 23, 2011 by Bob Collins (13 Comments)
Filed under: Energy

Democracy comes at a price. Today it's about $3.29. That's the average price of a gallon of gasoline in the Twin Cities today, a 16 cent jump in the last 48 hours and it's going to go higher.

Today, oil prices raced past the $100 a barrel, the highest price for oil in two years. At the heart of it is fear that the democratic wave spreading throughout the Middle East will increasingly affect oil supplies. In other words, everyone's quietly wondering if Saudi Arabia is next.

Tom Kloza, publisher and chief oil analyst at Oil Price Information Service, told CBS that he expects a peak of between $3.25 and $3.75 per gallon of gasoline, a prediction that already seems outdated.

There's a lot more than the price of oil that goes into the price of a gallon of gasoline, but when one goes up, the other seems to go up immediately, too. The last time crude oil went over $100 was September 2008. People here in the Midwest were paying $3.94 a gallon for gasoline then.

It seems pretty clear we're going to get to $4 a gallon soon, but that may be at the conservative end of things. Other analysts predict $5 a gallon.

In either case, we're back to the days of figuring out how to scrimp our way to another fill-up, What's your pain threshold?

Comments (13)

The volatility in oil prices just shows that while we definitely need a viable and affordable alternative fuel source, we'll probably be unable to afford it because there's no way we could just flip a switch and change from everything being petroleum powered to whatever new fuel becomes the standard. For one, we'll be too cash-strapped to afford the new technology/fuel because we spent all our money on petroleum.

And no, with skyrocketing grain prices and ethanol subsidies next up on the government chopping block, ethanol isn't going to save us. (Had to head off Bob Moffit before he could suggest ethanol).

Posted by Brian | February 23, 2011 2:39 PM

At what point does the government step in and do something about the speculation in oil prices? Since it is abundantly clear that we are eons away from a viable alternative energy source, why do we allow the oil companies to make record profits while people like me are going to have to cut short family trips this summer because I can't afford the gas to take my kids places? It makes me physically ill when I see oil companies rake in billions of dollars while John Q. Public is getting hosed.

Posted by Justin | February 23, 2011 2:48 PM

Most of the people in that video sound like they'd rather have the option of walking or biking.

Unfortunately for them, we've deliberately designed our cities to make those options as difficult as possible.

Posted by Ken Paulman | February 23, 2011 3:06 PM

With the Koch brothers running the government with their control of the Tea Party, and anyone who has been following this should realize they are the oil industry.

The oil industry is the top 10 money making companies in the world.

Oil speculation regulation will chaff the Libertarians who love allowing companies the ability to charge what ever they want no matter who is victimized...

Sorry, with the government that was voted in on a mandate to get jobs, well, the saving the little guy is low on their priority.

Posted by Kevin VC | February 23, 2011 3:29 PM

Oh...
And still we have no 'Jobs, Jobs. Jobs' bills.
In fact its more 'give to the rich' who already have and other off topic bills.

Wish they listen to people and not big corporate money and protect us so we can grow a real economy.

Posted by Kevin VC | February 23, 2011 3:31 PM

Off shore drilling. Give me a break. There needs to be a much bigger reckoning with our consumptive habits and economic system of who stands to benefit and what cost to consumers and society can or will we tolerate. I own a hybrid but that's only a small beginning. There are and will be huge advantages to emerging technologies that offer an alternative to our reliance on gasoline combustion engines and fossil fuel sources of energy. Anyone complaining about drilling for more and creating more dependency totally misses the boat AND wealth potential of new technologies. The sad thing is if you go all the way back to Nixon, Carter, Ford, Reagan, Clinton they all routinely go up and spouted the line "We need to decease our dependency on oil" but never did anything about it. We never held the energy industry, auto industry and oil companies feet to the fire. It was all empty rhetoric but if we had done something when it was the good and decent thing to do, as everyone Democrat and Republican alike had said, we wouldn't be in the dumb situation we are in now.

Posted by Richard Prince | February 23, 2011 3:41 PM

I don't mind too much that I'm paying more if the world is in the process of becoming more democratic, though I wish the profits weren't going into the pockets of speculators.

I'd love to see our cities redesigned so it's more comfortable to move around on foot, by bike, and with public transit. I've heard that 40% (some say 50%) of the population in Minnesota is unable to drive on their own -- they're too young, too old, have medical conditions, don't have much money, or simply choose not to have a car. Many of them can just ask for a ride, of course, but it's still amazing that we've designed a world where these folks usually can't get around on their own. Clearly we're taking an economic hit if this huge chunk of the population is dependent on others to get to their daily needs.

Carter challenged the nation to not consume any more imported oil back in the late 1970s, and the amount of oil used actually did start to go down. It took about 15 years for us to reach the same level of consumption again. I'm not sure if he can be given credit for the change in behavior, but Americans definitely started conserving. (I suspect it was driven more by the desire to reduce the hit to the pocketbook and by government regulation of car fuel economy).

Posted by mulad | February 23, 2011 6:07 PM

It seems to me that we have been at this place before, 40 years ago, 30 years ago and perhaps one time about 5 years ago. Remember "Drive 55--Bring 'em Back Alive!' of the 70's?. Remember when the speed limit was 55--and then ramped back up to 70 in the metro in the 90's....
What have we learned? Where are we living? Why do we all need our own cars?
Time to ask the same old questions....
We can figure this out if we all work together.

Posted by Lily | February 23, 2011 10:55 PM

I am looking longingly at my motorcycle that is still covered for the winter. Once the weather moderates and we transition our seasons from winter to pothole repair, the bike will be used as much as possible.

I'm already taking notice of those stretches of my commute where the worst of the potholes exist.

Posted by John O. | February 24, 2011 6:39 AM

Feeling good about buying a fuel effieicent vehicle a couple years ago. I would feel even better if it could run on E85 as well as gasoline.

Posted by Bob Moffitt | February 24, 2011 7:12 AM

Hmm. Actually, I think I have to question the entire premise of this post. Gas prices have been going up pretty steadily for the past two years. The recent spike is pretty tiny in comparison to the general trend -- just zoom out to a multi-year period on this chart: http://twincitiesgasprices.com/retail_price_chart.aspx

I suppose prices have been rising slightly faster than normal since unrest developed in Tunisia in December, but only slightly.

Posted by mulad | February 24, 2011 8:08 AM

Looks like its time to lube the bicycle chain.

Posted by bsimon | February 24, 2011 9:14 AM

I think the removal of beerholes on the road before potholes might offer better driving conditions for all.

Posted by tarbaby | February 24, 2011 9:55 AM