As the most expensive year ever for gasoline purchased at the pump comes to a close in the U.S., consumers are likely getting a break nonetheless before a big sting at the pump comes in the spring.
Some experts predict that gas, while dropping at the pump in the past month due to slowing demand, will likely spike as much as $1 dollar per gallon from current prices as early as spring 2012.
Analyst Tom Kloza, chief oil analyst for the Oil Price Information Service, told the August Free Press that while the price of a gallon of gas in the U.S. will likely drift lower through January due to low demand the price may jump $1 per gallon from those lows by spring.
Oil prices have risen recently over concern about tensions in the Middle East. Iran has threatened to close the vital Strait of Hormuz. Some one-third of all global oil tankers travel through the Strait of Hormuz, near Iran. On Tuesday, the prices of oil jumped more than $1 when Iran threatened to cut off the vital shipping route. On Wednesday, U.S. crude dropped slightly by 57 cents per gallon, to $100.77.
The rising price of oil has pinched margins of refineries since low consumer demand in the U.S. has pushed prices at the pump lower, even though 2011 was the most expensive year ever on average for a gallon of gas in the U.S. Americans are set to spend $483 billion at the pump this year, breaking the 2008 record of $448 billion, according to Oil Information Service.
The national average price for a gallon of gas is $3.258, according to the Energy Department's weekly survey of service stations -- 20 cents higher than one year ago. But it's also lower than the peak this year as demand eased in the slow economy. Recent indicators have suggested the economy is gaining momentum, however, abeit slowly. That fact, likely to lead to higher demand, combined with the rising price of oil due to Middle East concerns, is expected to send gas prices soaring in the U.S. by the end of the first quarter 2012.
Historically, the higher crude prices tend to yield higher prices at the pump, and there's no sign that Middle East tension will ease any time soon amid the fresh threats from Iran that it won't stand for such action as closing the Strait of Hormuz.
We are at the highest fuel prices ever for this time of year, even though they have dropped a bit in recent weeks, Kloza said, according to the Los Angeles Times. I think we will see prices in 2012 that will break ... records.