High gasoline prices in US, but limited impact
The national average is close to $3.05 a gallon – up almost 20 cents in the past two weeks.
It has become one of those rites of late spring: Gasoline prices soar and Americans threaten gasoline boycotts, while elected officials promise investigations and introduce legislation to crack down on price gouging.
Yes, the air is fragrant with plans.
The catalyst is a sharp rise in gasoline prices – up almost 20 cents a gallon in the past two weeks and about 85 cents a gallon since February. The national average is now close to $3.05 a gallon, about 10 cents a gallon higher than a year ago.
Not that prices are discouraging Americans from driving. In fact, demand for gasoline increased a robust 1.6 percent in April, according to the Energy Department. But the cost of tanking up has become so high that some gasoline stations report almost 80 percent of their customers are using credit cards to pay the bill.
Economists worry that consumer confidence could be damaged, with potential implications for the economy. It could be worse, though: Wholesale prices have moved up so quickly that many service stations haven't had a chance to fully ratchet up prices at the pump. But even though wholesale prices have dropped in recent days, the costs are not likely to change much for the consumer.
"You can appreciate that the consumer is frustrated," says Sam Turner, president of Calfee Co. of Dalton, which owns about two dozen convenience stores and gasoline stations in coastal Alabama and Florida. "We are, too."
The frustration can be seen in a flood of e-mails proposing a national boycott of gasoline on May 15. Craigslist reports more than 300 postings by people urging others to join. On MySpace.com, scores of people are vowing to avoid the pumps.