Economic Pains Continue As Gasoline Will Soon Surge Above $4 A Gallon.

[Obama 2012 1,714]

So many areas to place blame.

Speculators, investors, politicians, environmentalist whackos, etc.

The fact is at the end of the day though, the people who the politicians allegedly want to help, are the ones who will suffer the most. While an extra $1 a gallon or more isn't much for some, that transpires into a lot for lower income households.... higher fuel prices, meeans higher food prices, etc.

Troubling times ahead...

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http://abcnews.go.com/Business/wireStory?id=13328978&page=2

A drop in the dollar helped push oil near $112 per barrel Friday, setting a new 30-month high. If crude prices keep climbing, experts say, gasoline prices could hit $4 a gallon across the U.S. this summer.

Pump prices have jumped from $3.07 to $3.74 per gallon since the beginning of the year. The swift rise has forced the Oil Price Information Service to boost its retail gasoline price forecast to between $3.75 and $4 per gallon this year. OPIS chief oil analyst Tom Kloza said it may not be long before the national average tests the all-time record of $4.11 per gallon set in July 2008.

Further price hikes could do serious damage to the U.S. economy, he said. For consumers, "gas prices have more relevance on an emotional level than a lot of other things that they pay for," Kloza said. "People pay more attention to gasoline than phone service, cable TV or other services," Kloza said.

The national average for gasoline is now 88.3 cents higher than the same time last year, according to OPIS, AAA, and Wright Express. It's already above $4 per gallon in California, Alaska and Hawaii, and it's nearly there in Connecticut, Washington, D.C., Illinois and New York.

Oil and gasoline prices have climbed this year as the Libyan rebellion shut down the country's daily exports of 1.5 million barrels of oil. Libya produces about 2 percent of world demand, and analysts say making up for those losses will severely reduce the ability of other oil-producing countries to increase production in the future.

Barclays Capital has said that Libya's oil exports probably will be offline for several months. As fighting continues, more traders are going along with that prediction.

"The market is being forced to consider a possible major loss of Libyan barrels probably through the rest of this year and into next," analyst Jim Ritterbusch said.

Experts point to several other factors that have pushed oil and gasoline to record levels this year.

The U.S. economy added hundreds of thousands of jobs this year. That means gasoline demand could increase this year as more workers join the daily commute.

Last month's devastating earthquake and tsunami in Japan put further pressure on oil prices. Japan is expected to boost oil and natural gas imports while some nuclear power plants are offline.

A drop in the dollar this week also gave oil a boost. Oil is traded in dollars and tends to rise when the dollar falls and makes crude cheaper for investors holding foreign currency.

On Friday benchmark West Texas Intermediate for May delivery rose $1.41 to $111.71 per barrel in midday trading on the New York Mercantile Exchange. Prices hit $111.90 earlier in the day, the highest since September 2008. Oil has jumped 14 percent since the middle of March.

In other Nymex trading for May contracts, heating oil added 7.43 cents at $3.2803 per gallon and gasoline futures gained 4.65 cents to $3.233 per gallon. Natural gas lost 1.5 cents at $4.042 per 1,000 cubic feet.

In London, Brent crude rose $2.67 to $124.93 on the ICE Futures exchange.