Look for gas to hit $4.50
'Numbers are going up so fast I can't even keep track,' says an analyst who thinks prices will keep climbing.
That might be nothing compared to what could be coming down the pike, at least one industry analyst says.
Gas could hit $4.50 per gallon by Memorial Day, said Bob van der Valk, an independent petroleum market analyst who does contract work for 4Refuel, a Lynnwood gasoline delivery company.
"You're going to be over four bucks by the end of this week," said van der Valk, who works out of his home in Terry, Montana, near the North Dakota border. "The numbers are going up so fast I can't even keep track of it."
The local average price was cited by SeattleGasPrices.com, a subsidiary of GasBuddy.com, which tracks gasoline prices nationwide.
The Japan earthquake has fanned prices that already were rising because of political turmoil in the Middle East and a cutoff of domestic drilling permits following the BP oil spill, according to van der Valk.
Diesel fuel is in high demand in Japan to run power generators in stricken areas and to make up for power lost because of damage to the Fukushima nuclear plant.
Concerns about the future of nuclear energy also are contributing to rising gas prices, according to van der Valk.
And that's not all, he said. If conflict in Bahrain erupts into full-blown revolution, Saudi Arabia could cut off oil to the United States for perceived meddling in the affairs of its close neighbor, van der Valk said.
Then we're looking at $7 a gallon, he said.
"We're going to see everything happening at once," he said. "I call it the perfect storm."
Gas is 88 cents per gallon higher today in the Puget Sound area than it was a year ago, said Dave Overstreet, a spokesman for AAA Washington in Bellevue.
He said perhaps the coldest winter in 40 years on the East Coast, increased trading of petroleum as a commodity, rising consumption by China and increased trading of petroleum as a commodity also have contributed to rising prices over the past year.
Another, annually recurring factor is the transition from gasoline used in the winter to that used in summer, both analysts said.
Gasoline suppliers are required to sell a more highly refined, expensive grade of fuel in the summer than in the winter to prevent engine knocking, van der Valk said.
If and when things settle down, gas prices likely won't go back down as far as they did after the spike of 2008, when the cost returned to near $2 per gallon before rising again, he said.
Bill Sheets: 425-339-3439; firstname.lastname@example.org.
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