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Future of gas prices not ‘rosy’

POSTED January 13, 2012 9:07 p.m.

As gas prices continue to climb, reaching the highest level ever recorded at this time of year, GasBuddy released its 2012 projections which see prices reach $4 a gallon by late spring.

“While the 2012 outlook isn’t what I’d call rosy, we can look to Europe at their $6-$9/gallon gasoline and be happy that we’re still not paying as much as some countries,” said Patrick DeHaan, senior petroleum analyst for GasBuddy.

The forecast reflects a steady increase in gas prices nationwide through summer, then a slight decline by November and December. Volatility was taken into consideration in the forecast as unpredictable geopolitical issues arise, as well as refinery outages and programs, and weather impacts production.

Particularly, the continued destabilization of Iran, and other parts of the Middle East, could make a strong impact on gasoline prices.

“2012’s Iran situation isn’t 2011’s Libya situation — not by any means — it’s far worse. Consumers who think the Iran situation is over-hyped clearly don’t understand the high stakes behind not only the Strait of Hormuz, but behind Iran’s feud with the West,” DeHaan said.

Locally, gas prices have jumped 12 cents per gallon since mid-December, according AAA Northern California. The state average for a gallon of regular, unleaded gasoline is up 11 cents to $3.70. That’s 35 cents higher than California’s average price in mid-January last year.

“Consumers have been seeing a steady increase in gas prices ever since late last year,” said AAA spokesperson Matt Skryja. “The recent jumps at the pump are largely driven by investors’ buying behavior, which is linked to real, perceived, or potential impacts on supply and demand worldwide.”

In Turlock, the cheapest gas (as of Thursday) could be found at Costco for $3.43, followed by ARCO at 1801 Lander Ave. with $3.45, and Safeway at 3051 Countryside Dr. with $3.46.

To contact Kristina Hacker, e-mail khacker@turlockjournal.com or call 634-9141 ext. 2004.

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