Video: Summer gas pains?

By Jane Wells Correspondent
CNBC
updated 4/3/2006 5:38:31 PM ET 2006-04-03T21:38:31

Spring has sprung, but predictions for gasoline prices during the summer driving season are already out. And based on the prices here in Los Angeles, it’s not looking good.

Gas prices are already 37 cents higher on average per gallon than they were a year ago, according to AAA, the not-for-profit automobile lobby and service organization.

On top of that, next month oil companies have to replace the additive MTBE (methyl tert-butyl ether) because of groundwater pollution concerns associated with the chemical compound, which was added to gas at low levels to increase its octane rating and help prevent engine knocking.

The most likely replacement will be ethanol, and while the ethanol industry says its ready, the shift could create some shortages and price volatility. A lot of changes in a short time could cause some disruptions the U.S. Energy and Information Administration says. Some traders and gas station owners are very nervous. But in the short term, AAA says we are taking a breather.

“We are just coming off a week when gas prices jumped almost 15 cents in one week,” said Mantill Williams of AAA. “They have leveled off this past week, but it looks like we are going to be headed for possibly another record high. We may break that $3.05 that we hit last summer.”

And that would be without a destructive hurricane.

Where are we now? According to GasPriceWatch.com, which tracks gas prices and heating oil prices throughout the U.S. and Canada, the most expensive gas is, naturally, in Hawaii — more than $3.25 a gallon. The cheapest gas is in Salt Lake City, where it’s $2.05, while the national average at slightly more than $2.50.

GasBuddy.com, which offers local real-time gas price information, has a chart showing where the prices have heated up the most, with hot spots in places like the Navajo Nation, Humboldt County in northern California. The most expensive county I could find was tiny El Dorado County in California, with $3.01 a gallon on average.

But you have supplies falling even before the summer driving season starts, and you also have concerns about Iran and Nigeria on the supply side. Put those factors together, along with the transition to ethanol instead of MTBE, and there’s little wonder that oil is trading near $67 a barrel.

© 2012 CNBC, Inc. All Rights Reserved

Discuss:

Discussion comments

,

Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments

Data: Latest rates in the US

Home equity rates View rates in your area
Home equity type Today +/- Chart
$30K HELOC FICO 4.30%
$30K home equity loan FICO 4.99%
$75K home equity loan FICO 4.36%
Credit card rates View more rates
Card type Today +/- Last Week
Low Interest Cards 11.04%
11.01%
Cash Back Cards 16.44%
16.43%
Rewards Cards 16.04%
16.04%
Source: Bankrate.com