Rumblings of energy crisis begin as gasoline costs move higher

Distant grumbling about energy crisis has begun as gas prices approach record highs which were set several years back. Households and various industries are feeling the effects of the gas price hikes, which have been ongoing for weeks. The rise in price isn’t really going to likely subside, either.

Price of gasoline quickly rises 20 cents

The nationwide average cost of a gallon of gasoline has risen by almost 20 cents in the past few weeks. Between March 18 and April 8, gasoline went from $3.57 to $3.76 nationwide according to Reuters. In the last year the increase went up by about a dollar. In July of 2008, gas hit a record high at about $4.11. The costs have risen higher than that now. CBS reported that on April 8, California had a nationwide average of $4.14.

Flights will suffer from this increase a lot

The air travel industry is set to withstand a battering as the cost of jet fuel is increasing, according to CNN. The increase in the price of petroleum has caused jet fuel to rise to about $112 a 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 begun to fall on stock markets due to the increasing cost of oil. On April 8, the stock price of Delta fell by 4 percent, Jet Blue fell by 5 percent and UnitedContinental stock fell by almost 7 percent. Experts fear the price of gasoline is not going to drop anytime soon due to unrest in the middle east. Airline tickets will only continue to go up as the cost of gasoline continues to go up in tandem.

Consumers are reducing their spending habits

Consumers want to do something about the increase in price. The Daily Finance reports that 70 percent of the nation’s gas stations have reported drops in sales. So although prices are rising, sales are decreasing. One way individuals are cutting back in gasoline is though the purchase of more economic vehicles. According to USA Today, hybrid vehicles sales this year alone have increased by 37 percent. The increase in price is leading to lower demand, as fewer individuals are willing to pay the increased cost of fuel.

Information from

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