The Rise Of Gas Prices And Its Effects

COON RAPIDS (WCCO) — How about paying $4 a gallon for gas? Some experts say it will happen soon, and we won’t be paying more just at the gas station.

We’re already seeing an uptick here in the Twin Cities.

“I guess until I’m willing to drive less I can’t complain too much,” said Eric Setter of Coon Rapids.

What you put in your tank is directly affected by what is occurring half a world away. Right now, Iran is upset over tighter sanctions. So, the country has threatened to close a major waterway where a huge percentage of the world’s oil reserves pass through every day.

“When the value of Mid-East gas goes up, that increases the value of all kinds of gas throughout the planet,” said professor David Vang.

Vang, a finance professor at the University of St. Thomas, says we’ve knocked on the door of $4 gas in recent years and by Memorial Day, we will knock it down.

Your groceries and your airfare could also increase. Vang says they are all tied together.

As the price of oil goes up, so does jet fuel and Vang says some airlines could tack on an extra $10 to their airfare to off-set the costs.

“If one or two airlines can make this stick, then others will follow,” said Vang.

Fuel prices also come into play when food is delivered to grocery stores. So milk, eggs, cereal and everything in-between could see a slight hike.

But consumers have been down this road before. One man we talked with told us he is from England, but currently lives in Georgia and drives 1,200 miles to visit his daughter in Minnesota. For him, every little cent adds up.

“Let’s hope it doesn’t go up to $4 a gallon,” he said.

Vang said another reason gas prices go up as we get closer to spring is because the refineries switch to a different kind of gas that uses more ethanol.

Vang added that if we do hit $4 gas, it will likely go back down by the fall — as will the price of food and airfare.

More from John Lauritsen
  • Manny

    It’s a good thing Obama stopped that oil line to Texas where they have massive refineries.

    Otherwise we would have way too much gas.

    • Ordinary Guy

      I hate to be pessimistic, but right now the pipeline comes to Minnesota. The only advantage I can see in sending this crude to Texas is to refine Canadian oil and ship it to higher bidders, even over seas. That doesn’t help us much, it’s higher prices here and none of the jobs. The US just takes the spill risk. I hope I’m wrong.

    • Tom

      @ Manny

      If you would listen to people who actually know something that we can open all the refineries that we want and the most the prices would drop at the pump would be about 3 cents. Unless you are one of those who took Michelle Bachmann at her word when she said prices would drop by $2 over night.

    • Tom

      Sit on your brain’s much Manny???

  • Jake

    We need alternative energy, But I guess as long as people are getting rich off oil it will never happen!

    • Ordinary Guy

      With the rise of China and India, and our falling economy, they’ll probably outbid us for all kinds of raw materials, including oil. The higher prices will make locally-produced alternatives more practical, but we need a lot of stakeholders on board for anything big enough to happen. Token efforts and marginal energy gains won’t do.

  • sue

    Thank you Obama, so long, worse than Carter

    • Tom

      @ Sue

      You seem to forget that one of promises that the Bush made was if we went into Iraq we would see much cheaper gas here in the states. And we all know that didn’t happen now did it!

    • Jake

      Your an Idiot!

      • Jakesmomma

        No jake you are a liberal rat!

      • redrider

        Why is Sue an idiot? Your jack hole president is done this year so.

        • Tom

          @ redrider

          Well more than half of your side does not like your candidates. So you are basically saying that the rest of us would rather put a right wing nutjob into office and take our chances.

  • Ned

    Nothing impacts the economy as much as the price of oil. When you declare war on fossil fuels, as Obama has, you have to expect this as the result. It will get much worse before it gets better.

  • jimmy

    Maybe they should stop exporting gas. Kind of hard to understand how they can export gas to Mexico and sell it for under 1 dollar, then sell to us for over 4 dollars a gallon.

    • mark

      Bingo! Pipeline would do nothing without some tariffs to keep it in house.

    • what?!?

      Finally some one who gets it!

  • Pete

    1.79 when bush left office “you miss me now”

    • Tom

      I call BS. Maybe Bush SR., but not GW. Try some of these facts on for size. We currently export 20% more oil then we import. The majority of the wells in North Dakota are sitting idle waiting for the price to go up. The Canadian plan for the Keystone pipeline product is simply dumped on the open market, meaning we are willing to risk our environment and aquifer so Canada can sell oil to China? How can we have a law that prohibits collusion for professional sport teams but not for the oil industry which truly does effect everyone?

      • Pete

        look it up, thats exactly what the price was when Obama took office. We recently lost half the deep water wells in the gulf that went to Africa and South America, new regulations have slowed opening new wells, can’t drill in california, florida or lay pipe for keystone. For your information, many wells lay idle until the price to sell it exceeds the price to get it out of the ground. Thats how they decide when to drill. Thats why cutting off the deep water wells and gulf oil hurt us.

        • Tree Hugger

          We were also in a deep recession when Bush left. People had less to buy gas thus supply was greater than demand. That’s the only reason gas was lower. It’s funny how people blame Obama from this country’s financial problems but fail to notice it was Bush policies that caused the crises. Gas was over $4 a gallon in 2007. One year before Bush Jr. left. Also, Texas has thousands of more oil wells than Iraq, but Iraq is sitting on 25% of the world’s oil.

          • Tom

            @ Tree Hugger

            Yes Bush put us into deep recession which today conservatives are in denial about. And conservatives seem to forget that we were promised cheaper gas for years to come if let Bush and Company invade Iraq and that didn’t happen. But I guess when you have conservative in office $4 gas is cheap, but when a Democrat is in office they should be thrown out of office. But when you live in bubble like the conservatives do this shouldn’t be a surprise.

          • DougT

            Its one thing to lie to get into a bad situation (I will make the waters go down and the Earth pure by my command!) …….and another to make it worse

            In what fantasy word do “the regulators” save us? They were all in bed (democrats) with Fanny and Freddy) and defended them to the end. Years ago Conservatives were attempting to correct this but The Left kept pushing. “Its bigotry and raciest to not loan to people that cant pay you back”…

            So the cycle started and prices for houses kept going up – a scam game for sure – But The Regulators” set up the rules to the game so everyone played it to the hilt. I mean speculation on the home you live in was insane – but in our PC world one just cant tell people that they are being stupid… And We The People were left holding the bag – that We created

          • DougT

            And the amount we have in America is greater than Saudia Arabia – but “tree huggers” wont let us use that…

            The problem The Left has with cheap energy – is that its the life blood of Capitalism – and they are trying to kill it off. We all should live in dark caves I guess….

            (Unless you believe in fairies and think the alternative energy boondoggles will save us…not for a looong time it wont and it will take capitalism to make it work regardless)

          • Pete

            we were not in a deep rececssion, what are you five?

        • Tom

          @ Pete

          What caused to BP spill in the Gulf? To many regulations? Or not enough regulations? Regulations would have forced them to spend about $250,000 on safety valve, no regulations saved them from having to do that. But conservatives have always put profits before people.

          • DougT

            The coast guard did not have the foam to put out the rig fire – so they used water. That caused the platform to tip and break the pipeline – ergo the leak.

            Regulations my foot – it was Obamas cutting of funds for the coast guard that really made this the mess it became

            • Hal

              With a valve they could have shut it off. Are you aware that when you can close a valve nothing else matters. One can also say the coast guard probably was not equipped with foam because the Bush Administration diverted it to Itaq. Don’t expect an acknowledgment of your ignorance on how the valve would have solved the problem,.

    • deltadawn

      ah, the good old days.

  • outlaw

    Vang must have got his smarts via a wheaties box because in my almost 60 yrs Ive NEVER seen grociers go bdown after theve gone up who is he tryin to BS

  • Murph

    Wow,it worked so well for the Bushies and hedge funds debacle! Why not just do it all over again? Wall Street and investors have some crazy idea that the populace can will keep on spending more for everything forever! Yup,just like last time! Only this time there will be no bail outs,there will be no “consumers” left with enough cash to consume much more than beans and weanies,Much less DRIVE somewhere! The highway to Hell is wide open and there is no speed limit! Hurry hedgies ,hurry,of course the price will still go up on gas.You controll that,or do you? Are you feeling lucky? Well are ya!

  • what?!?

    Why is it that you people waste time summing up all that is happening in the world to be the effect of some political agenda. Some blame Obama while others defend him. Some blame bush while others defend him. Don’t you idiots see that this is EXACTLY what they want you to do. Cause if your deeply engaged in these stupid arguments you will not have time to seek out the truth. THE ENTIRE GOVERNMENT SYSTEM IS A FRAUD! Not one side is better than the other. Not everything hat happens has a political agenda. The reason why gas prices are going up is simple – GREED.. We export more than we consume to create more demand on supply on hand.. period…. Nothing new.. nothing funny.. Thats it!

  • Ruth

    The price of gas will hit $4.00 or more per galon, and then, just like magic and just in time for the election, the price will drop so the current administration will look like heroes which they most definitely are NOT.

    • Hal

      Perhaps the price of gas is going up simply because the oil companies do not like Obama and they want to make a huge profit.

  • More reality..less phony's

    This article could have been written 6 years ago…gas will go up then down then up then down…just like the stock market…just don’t know when! Gas was $1.79 when Bush left office? I don’t thin so. More lies by repugs!!!

  • Guess we know the facts

    Can anyone find pictures of Gearge Bush holding hands and kissing Saudi’s, I can, they are all over the Web.

  • Murph

    So what is the excuse for diesel prices? Nobody heats with it anymore except in the far northeast United States.No mandated substances in it as far as I know!So all goods moved by truck or train costs more too! The Government must decide who deserves the money more. Foriegn governments,poor foriegn people or the citizens whose labor brings in the money? Americans want to live in peace and get more of the money we produce thru our labors.Either that happens quickly or the whole system is going to fail.It already is one family at a time! What do our leaders have in mind for us? Residency in one of over 800 REX 84 camps? While foriegn people spend money that is rightfully ours! Wake up in Washington and everyplace else.Once we are forced to pull the plug out of the worldwide welfare system.Somebody is going to have to live of the fruits of their own labors! Starting with Washington D.C.!

  • Common Cents

    Drill baby drill, we have plenty of oil here, we’re just saving it till everyone else runs out and then we’ll sell it to them for 10 bucks a gallon.

    Me, I’m goin back to steam power since I don’t like cleaning up horse poop.

  • Tree Hugger

    Why use our oil? Why not use the world’s first and then use ours giving us all the power. We don’t use ours because of security interests.

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