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Gasoline Hits $4 A Gallon; Higher Prices Expected

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The Associated Press

Published: June 9, 2008

NEW YORK - The average price of regular gas crept up to $4 a gallon nationally for the first time over the weekend, passing the once-unthinkable milestone just in time for the peak summer travel season.

Prices at the pump are expected to keep climbing, especially after last week's furious surge in oil prices, which neared $140 a barrel in a record-shattering rally Friday.

Although Americans who have to drive will feel the biggest squeeze, the increased prices also translate into higher costs for consumers and businesses forced to shoulder increased costs for food and anything else that needs to be transported.

"I don't think we've felt quite the full impact of $138 or $139 a barrel oil," said Jason Toews, co-founder of fuel price research site GasBuddy .com.
Gas prices rolled past their latest threshold Sunday, increasing to $4.005 a gallon overnight from $3.988 the day before, according to AAA and the Oil Price Information Service.

Skyrocketing oil prices, which are trading at more than double their level last year, are largely to blame for the surge. Crude prices shot up more than 13 percent late last week in their biggest two-day price gain in history.

"This could be a real weight on the economy," James Cordier, president of Tampa-based trading firm Liberty Trading Group, said of oil's jump Friday. "With every nickel that gas goes up, people are driving less and less."

Oil's latest surge caught some longtime petroleum industry veterans off-guard, and left analysts wondering whether it represented a one-time spike or the beginning of a new wave of advances.

Yolanda Cade, managing director of public relations at AAA, said gas prices are likely to rise further, although the automotive club is waiting to see where oil prices head this week before making any predictions.

"We've cautioned gasoline station owners against not recklessly increasing retail prices just because of one big jump in the crude market," she said Sunday. "One day of trading doesn't constitute a market trend."

WHAT WE'RE PAYING

•California has seen some of the highest prices; a gallon there now averages $4.436 a gallon, the most in the country.

•Missourians are paying the least at the pump, with a gallon selling for $3.802 a gallon.

•A gallon of diesel now sells for $4.762, up nearly a penny overnight. Prices hit a record atop $4.79 at the end of May.

•Prices have risen by about 20 cents in the past three weeks, according to a report by the Lundberg Survey released Sunday.

Source: The Associated Press

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