NEW YORK (AP/THE BLAZE) -- The average price of gasoline is now above $4 per gallon in five states, and it could rise to that level in New York and Washington, D.C., this weekend.
For American drivers, the $4 mark is a grim reminder of tougher times. The last time gas prices were that high was in the summer of 2008, just before the economy went into a tailspin. Retail surveys suggest motorists are reacting to higher prices now by buying less fuel, yet the government expects pump prices to keep climbing this summer.
Via Fox News is this video report on the matter:
The national average has increased for 24 straight days, hitting $3.82 per gallon on Friday. Motorists in Connecticut, Illinois, California, Hawaii and Alaska now pay more than $4 per gallon. A gallon of regular cost an average of $3.979 in New York and $3.999 in Washington.
The rapid increase at the pump follows a parallel rise in oil. Oil, which has been rising slowly since 2009, gained momentum as the Libyan rebellion effectively shut down its exports. Crude has jumped 28 percent since the uprising began in the middle of February.
Oil fluctuated this week amid uncertainty about how much higher it could go. It resumed its climb on Friday with some positive economic news. The Federal Reserve released data showing U.S. factories increased production for the ninth consecutive month in March. And the Labor Department reported that inflation rose 0.1 percent last month, excluding food and gas prices. Analysts expected inflation to rise twice as much.
Benchmark West Texas Intermediate crude for May delivery rose $1.55 to settle at $109.66 per barrel on the New York Mercantile Exchange. At one point it rose to $110.10. In London, Brent crude added $1.45 to settle at $123.45 per barrel on the ICE Futures exchange.
Some traders and analysts expect oil to keep rising this year, arguing that the Libyan crisis will continue to constrict world supplies. Libya provided less than 2 percent of global demand. The world may still enjoy a surplus of crude, but experts say OPEC would struggle to keep up with demand if another conflict hampers oil production elsewhere.
Others point to retail surveys and industry reports that suggest Americans have started to buy less fuel, which could bring down the price.
"The biggest problem is that the data is not that reliable in the short term," said Michael Lynch, president of Strategic Energy & Economic Research. "And when you're in a bull market like this, people will talk themselves out of negative news. They'll say any drop in demand is an aberration: People aren't burning their SUVs just yet, and the economy hasn't collapsed."
Experts say crude could remain in a holding pattern while the market awaits further evidence about how consumers are handling higher prices.
This week, benchmark crude has mostly moved against the dollar. Oil, which is traded in dollars, tends to rise when the dollar weakens and makes crude barrels cheaper for investors holding foreign currency. It tends to fall when the greenback moves in the opposite direction.
In other Nymex trading for May contracts, heating oil rose 3.52 cents to settle at $3.2242 per gallon and gasoline gained 5.45 cents to settle at $3.2892 per gallon. Natural gas gave up 0.8 cent to settle at $4.204 per 1,000 cubic feet.